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Politics : Formerly About Applied Materials

AMAT 259.92

-1.1%

Dec 30 3:59 PM EST

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To: michael97123 who wrote (56572)	11/30/2001 9:07:32 AM
From: Alastair McIntosh	Read Replies (2) of 70976

michael, it appears to me that it is not NVLS specific. AMAT does not appear to be doing better. They have also guided lower for at least next quarter and really have no clear guidance, only hope, for the second half of next year. Some on the thread have suggested that AMAT will hit $20 billion is sales by 2005. This appears to be highly improbable. Sales will probably shrink next year to about $5.8 billion tops. To get from there to $20 billion in 2005 would require a growth rate of 51% per year for three years. I think that 30% would be more reasonable which would give sales of just under $13 billion in 2005. This may produce EPS of about $3.50. With a generous multiple of 30 this gives a share price of about $100 in 2005 or an annualized growth rate of about 25% from here. I feel that the above scenario is overly optimistic as the chip industry suffers from unprecedented overcapacity. Capacity buys will probably not be necessary until 2003 with revenues showing up in 2004. As to AMAT's price in the short term, I am guessing that it pulls back to the low to mid 30's over the next month. Al

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