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Technology Stocks : Semi Equipment Analysis
SOXX 282.70+4.4%Nov 24 4:00 PM EST
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To: Gottfried who wrote (3028)5/5/2002 4:38:29 PM
From: Donald Wennerstrom  Read Replies (2) of 95465
 
OK here goes for the Billings estimate.

Going back to the charts again and looking at the previous cycles from 1995, a reasonable case can be made that billings follow bookings by 2 to 4 months with some minor exceptions. By that I mean, say bookings were 1.1M for June - then billings would be 1.1M 2 to 4 months later. Based on this assessment, I will pick the average delay to be 3 months.

The billings have been essentially "flat" for the past 5 months at around 810M, so that will be used as the base. Since the turn around in billings is just getting started(there should be some increase next month) the "takeoff" is assumed to be a small curve - lets say in 3 months(June) the billings will be at 850M.

For the rest of the year(June thru December) assume the billing increase is the same as the bookings increase. Since 2 numbers had been put forth for bookings, 63M and 92M, lets split the difference and "round off" to 75M per month.

Now it's just a simple matter of arithmetic to get to the answer of 850 plus 75 times 6 to get to a billings estimate of 1300M.

If all that were to happen, bookings of 1500M and billings of 1300M, it would be like winning the lottery in California!<gg> However, if it did happen, the BtB for December would be 1.15.

Don
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