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Technology Stocks : Semi Equipment Analysis

SOXX 304.96

+0.4%

Dec 23 4:00 PM EST

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To: Cary Salsberg who wrote (2587)	4/2/2002 12:54:47 PM
From: Return to Sender	Read Replies (1) of 95627

>Why are semi-equips so close to peak 2000 valuations (KLAC hit ~70%, NVLS ~80%, AMAT ~50%) with orders at 20-25% of peak? Why is there an apparent disconnect between one end of the chain (CSCO, LU, NT) and the other (AMAT, KLAC, NVLS)? < Beats me Cary. Maybe it is the so called dumb money pushing the semi-equips higher. Maybe it is 11 interest rate cuts. Maybe fiscal stimulus will actually get technology back into a generalized recovery stronger and faster than you expect. Clearly semi-equips stocks have outperformed networking and telecom gear makers up to this point of the cycle. Seasonal patterns show semi-equips up in the first quarter on a regular basis. Valuations on both sides of the equation are quite high but this quarter has typically proven to be a good one for networking stocks. If orders do not ramp up for telecom and networking gear then all these stocks can fall further. Personally I think we will remain in a trading range with an upward bias for the SOX until we get further evidence of actual end point demand versus restocking. As far as the Networkers and Telecom Stocks I can only say that I do not follow them as closely as I do the semis but ultimately those players left in the game will benefit from the shake out that has taken place with so many smaller companies either bankrupted and or acquired. RtS

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