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Technology Stocks : Semi Equipment Analysis

SOXX 302.84

+2.0%

4:00 PM EST

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To: orkrious who wrote (3700)	6/28/2002 8:52:51 AM
From: robert b furman	Read Replies (1) of 95503

HI Ork, OK - I'm just not sure where to get cyber dollars. Intc has upgraded their entire manufacturing process for .13 linewidths and below and currently have 3 300 mm lines running. When pc demand turns the corner - they will have full efficiencies -like no one else will have. There are but a handfull of companies that can even utilize the huge yield gains of 300mm.Intel is one of the few - but it takes huge volume to drive the real savings.300 MM fabs generate 225% more chips than 200MM wafers Intel has new chips coming out and so does AMD.What AMD doesn't have is the financial strength to survive the price competition that Intc is handing to them. There's no disputing that IT spending is soft now.The bet is that this will strongly pick up as many firms growing profits now will spend heavily in the last H02 to take advantage of the 30 depreciation passed as a result of the WTC bombings. My personal opinion with PC sales in this quarter is not so much of a drop in demand but more a stuffed channel from past stuffers - HP and Cpq.When you stuff channels from the #2 and #3 box maker -I don't doubt microprocessors and Dram slows up the next quarter - especially when it is seasonally the low quarter. I've been in and out of Intc for years.It usually shakes 5% below its past resistance levels.That puts Intc at a great buy around 17 ish.It may go lower - and if it goes to 10 I'm gonna be one big holder of their stock. Heck I'll be able to pay you that bet.gg Over the years Dan Niles has been right on with his analysis of INTC.He is very critical of their low profitability now.I believe the low margins are intended to be a marketshare gain move.Once the market share is there - the 300 MM fabs will kick in efficiencies that will be the death blow to AMD. After all Wcom showed us you can only lose money for so long - even if you are a good cook. These boys have the money - they've spent the money and they have a plan.The degree to which the market doesn't appreciate that will give me a better entry on a true blue chip leader. INTC is to AMD as MU is to Hynex. Predator pricing till you go broke.After that the world is yours to gouge.Well before then Intc will be in the 30's. JMHO JMHO Bob

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