Applied Materials No-Politics Thread (AMAT) Message Board

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Technology Stocks : Applied Materials No-Politics Thread (AMAT)

AMAT 269.55

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3:59 PM EST

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To: Sun Tzu who wrote (5943)	4/19/2003 4:17:02 PM
From: Alastair McIntosh	Read Replies (3) of 25522

We may well go down for the rest of the year. The Iraq war contributed to an artificial rise in semiconductor sales in Q1 as manufacturers over-ordered in fear of supply disruptions. The resulting high inventory levels will lead to a reduction in orders in the second half with a corresponding drop in equipment orders. In the longer term the equipment industry has problems. We have already seen pretty good growth in semi-conductor unit sales without much of a reduction in overcapacity. There is no "killer-app" to further drive unit growth. 300mm tools mean that additional capacity comes on at ever lower costs. I don't know where stock prices will go but I believe that current prices are already discounting a substantial recovery. I anticipate a gradual realization among investors that the rate of revenue growth and profitability of the industry has declined. If I am right there will be downward pressure on stock prices for the intermediate future.

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