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Technology Stocks : Semi Equipment Analysis

SOXX 316.33

+1.3%

Dec 10 4:00 PM EST

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To: Gottfried who wrote (2377)	3/24/2002 12:31:43 AM
From: Cary Salsberg	Read Replies (3) of 95561

Gottfried, The new accounting rules cause billings to lag by the extra months it takes for customer acceptance. Since shipments have been declining each month for a while, the billing decline has been slowed by the lag and the result is that billings reflect shipments a few months ago which were higher than current shipments. So, I agree with RtS BTB is lower. The lag will cause BTB to be higher, longer, once bookings exceed billings. I have stated that "quality" has been given a valuation premium, so I generally agree with RtS' "only game in tech town" idea. I don't think analysts understand how slowly the upturn will be and "next years" earnings estimates could require downward revisions even as the upturn unfolds. I would not be surprised to see a 20-25% pullback when the market starts understanding the need for revisions. I think this will take AMAT from $60 to $45-48, for example.

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