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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: Ian@SI who wrote (2385)	3/24/2002 2:43:30 PM
From: scott_jiminez	Read Replies (1) of 95558

About 6 weeks ago S&P upgraded KLIC from 3 stars (hold) to 5 stars (buy). Part of the justification of that was the recognition, to closely paraphrase their words, that KLIC was trading at a cycle-bottom valuation based on p/s and that the stock usually peaks at a p/s of 5-6. These historical facts cited by S&P also don't take into account the broad diversification program the company has accomplished over the past couple of years - and which is bearing fruit now - so the historical p/s numbers may, in fact, be low for KLIC's current revenue stream. You also didn't take into account that KLIC traded at a p/s of ~0.8 in September. Thus, 'if history is any indicator', the stock has ALREADY bottomed and will do it's normal 3X-5X upward move before it peaks once again. Perhaps you should debate the facts as S&P sees them. Clearly, S&P did not, and does not, think it is currently too 'early' to enter the backend stocks, and neither do I. All IMO.

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