Semiconductors . . . Semi equipment industry book-to-bill ratio rises to 0.97 in July, in line with Moors and Cabot's estimate of 0.97 and up from 0.93 in June. Fahnestock 's estimate was 0.93. July bookings were also higher, coming in at $763.4 million versus June bookings of $722.3 million.
Bear Stearns analyst Gurinder Kalra maintained his near-term cautious stance on Micron Technology due to the lack of improvement in channel inventory levels for dynamic random-access memory (DRAM). "It appears that DRAM inventory that was built on momentum buying continues to remain in the channels due to expectations of strong back-to-school PC demand," Kalra said. Kalra added that pressure to release inventory has been rising given that price increases that were expected in the first half of August have not materialized. The stock surged on Monday, after market research firm Gartner said the DRAM market was on the verge of a recovery.
M-Systems's Mobile DiskOnChip has been adopted in Sony's PEG-UX50 Clie handheld device. Mobile DiskOnChip delivers the storage capacity needed within the new Clie model to realize functions such as PDA/scheduler, address book, task management, memo pad, music player, digital image capture, and movie playback.
Advanced Micro target upped at JMP Securities to $15 from $8 based on moderately bullish view on the semiconductor industry for PC, server, and cell phone market growth in 2004. With AMD now being cash flow positive and the outlook for moderating capital spending, firm believes stock can trend toward 10-year mean multiple of 1.2x forward sales, roughly $15. Firm maintains its Strong Buy.
Boxmakers . . . Hewlett-Packard reported 3rd quarter pro forma results (excluding restructuring charges, amortization of purchased intangibles and acquisition-related items totaling $0.10 in EPS) at $0.23 in EPS (vs. $0.14 last year), below $0.26 estimate (despite an additional penny attributable to a lower tax rate of 19% than expectation of 23%) and First Call consensus of $0.26. Revenues for the quarter of $17.35 billion grew 5% on a year/year basis but fell 4% sequentially from the April quarter’s $18.0 billion reflecting seasonality, below expectation of $17.5 billion (by roughly $186 million), despite favorable currency translation which helped revenues by 7 percentage points on a year-over-year basis or roughly $1.1 billion. On a product basis, the shortfall in revenue was attributable to Personal Systems with weakness in U.S. commercial desktop and
aggressive pricing pressures in consumer, as well as Enterprise Systems where revenues were lighter than H-P’s expectations owing to weakness in low- to mid-range UNIX and sales coverage restructuring, while Imaging and Printing revenues were short of our expectations as H-P was impacted by discounting old inkjet products in front of its Big Bang II launch. In terms of geographies, Europe was especially weak at $6.4 billion in revenues, up 9% from the prior year but down 8% Year/Year in constant currency as well as Japan which grew 6% Year/Year to $740 million but was down on a year-over-year basis in constant currency. Americas revenue grew only 1% Year/Year to $8.2 billion, representing 47% of total sales, while Asia-Pacific was up 8% Year/Year to $2.0 billion.
How Did H-P Do On Revenues? While H-P has executed well on cost/expense reductions post-Compaq merger, it is yet to show consistent execution in delivering on both earnings and revenue expectations. To compare H-P’s revenue performance with its key competitors in the most recent fiscal quarter (all HPQ numbers include Compaq in the year-ago comparison):
PCs: In the most recent fiscal quarter, H-P's total PC business was up 5% Year/Year while Dell's revenues in desktops were up 8% Year/Year and up 16% Year/Year in notebooks;
Services: H-P’s revenues at $3.1 billion were up 5% Year/Year, while IBM at roughly $9.6 billion in services (excluding PwC for a fair Y/Y comparison) grew at 11% Year/Year;
Enterprise Hardware: revenues at $3.7 billion grew less than 1% Year/Year, while IBM’s enterprise hardware revenues at $3.2 billion were up 10% Year/Year and Dell’s nterprise revenues at almost $2.0 billion grew 23% Year/Year;
Printing & Imaging: revenues remain strong at $5.2 billion, or up 10% Year/Year, compared to Lexmark’s $1.12 billion in revenues, up 6% Year/Year.
RobBlack.com MarketWrap
robblack.com
Thanks for updating the tables Don. I guess the market is pricing in huge equipment orders growth?
I just don't know how these price levels can be sustained without a tremendous lift in the btb but technically the market still looks good if not great. If not for the recent low numbers on the TRIN, TRINQ, put to call ratio and put to call ratio/vix ratio I would be even more certain that we have a breakout here in the market that can hold up. Because of those indicators I think we must at least consolidate before moving higher.
Of course if the market ever does do some sound fundamental analysis then I have to simply state Bill Gates has good reason to be selling MSFT.
And that's a pretty darned dependable earner in techland. What about our more cyclical favorites?
JMHO, RtS |
