Michael, Yes, your are right - the thread has grown quiet.
<The thread has gotten awfully quite lately. Is it that no one can believe we are still going up?>
Maybe we have some more upside, but I think it is getting pretty risky. You had a nice phrase in your post:
<for now the market sure looks like it wants to head higher and the rising tide is lifting most boats.>
There has been a lot of good news in most sectors as the summer has progressed which has lifted "most boats", including the semi-equips. However, focusing in on the semi-equips, one could argue that little has changed for the better in the semi-equip world. Several bits of posted information suggest that this is true. As an example, Brian has just posted the following on the AMAT thread.
Message 19387366
The lead-in to the article says:
< It's earnings season again, but don't expect too many miracles in the slumping semiconductor equipment and materials market.
Leading suppliers of semiconductor equipment and materials are expected to report their financial results over the next few weeks. Based on the early predications, many vendors will meet their 3Q forecasts--by a nose, according to a report issued this week from UBS Securities LLC.>
Let's take another snip from the same article.
<Applied Materials Inc., the bellwether in the industry, is expected to report its fourth-quarter and year-end results in November. The chip-equipment giant is expected to report $1.117 billion in sales for its current quarter, up 2 percent from the previous quarter but down 23 percent from the like period a year ago, according to UBS. It is expected earn $0.05 per share in the period, compared to $0.05 in the previous period and $0.09 a year ago, according to UBS.>
This hardly sounds like a great performance to me - revenue down 23 percent from the like period a year ago and earnings at 0.05 compared to 0.09 a year ago. At this time last year, AMAT was selling at 10+ and now it is selling at 20+. This performance is all based on recovery, that is not evident today.
From RtS's post earlier today:
Message 19387324
[snip] < Semiconductor Equipment . . . Gartner said growth prospects for 2003 semiconductor capital equipment have "dimmed" due to slow order momentum and low second-quarter sales. Gartner now expects chip capital spending to total $29.7 billion, up 7.9 percent from 2002, but down slightly from earlier projections of $29.9 billion. "Ultra-conservatism is holding back spending on new equipment, at least for the wafer fab," said Gartner managing vice president Klaus-Dieter Rinnen. "As harsh as it might sound for capital equipment vendors, the cautious investment behavior might actually be for the better of the industry.">
And finally, let me post the following table below showing predeicted earnings trends for the Group over the past 5 weeks.
- DATA FROM FIRST CALL
- 9/4/03 10/9/03
- EARNINGS EST EARNINGS EST EARNINGS CHG
SYMBOL CURR YR NEXT YR CURR YR NEXT YR CURR YR NEXT YR
AMAT 0.13 0.46 0.13 0.46
ASML -0.34 0.37 -0.32 0.38 0.02 0.01
ASYT -1.02 0.44 -1.02 0.50 0.06
ATMI -0.01 0.64 -0.13 0.63 -0.12 -0.01
BRKS -1.56 0.24 -1.56 0.24
CMOS -1.59 -0.41 -1.49 -0.40 0.10 0.01
COHU 0.06 0.62 0.06 0.62
CYMI -0.31 0.97 -0.30 1.00 0.01 0.03
DPMI -1.80 0.70 -1.80 0.70
EGLS -2.01 -0.71 -2.01 -0.71
FSII -1.41 -0.10 -1.41 -0.10
HELX -0.09 0.43 -0.09 0.42 -0.01
KLAC 1.03 1.80 1.03 1.86 0.06
KLIC -1.09 0.20 -1.09 0.19 -0.01
LRCX 0.37 0.92 0.39 0.99 0.02 0.07
LTXX -0.42 0.44 -0.46 0.44 -0.04
MTSN -0.60 -0.06 -0.59 -0.01 0.01 0.05
NVLS 0.18 0.67 0.18 0.68 0.01
PHTN -0.96 0.54 -0.96 0.57 0.03
PLAB -0.20 0.72 -0.20 0.73 0.01
SMTL -0.34 0.16 -0.34 0.14 -0.02
TER -0.60 0.46 -0.60 0.45 -0.01
UTEK 0.14 0.68 0.15 0.67 0.01 -0.01
VECO 0.19 0.69 0.19 0.69
WFR 0.47 0.61 0.47 0.61
TOTAL -11.78 11.48 -11.77 11.75 0.01 0.27
At the bottom line, the estimates have changed very little over the past 5 weeks. There is no projection of a recovery based on these earnings estimates for this year and next year. The market expects these to rise, but so far there is no "evidence of life" in the semi-equip sector.
Maybe all these "signs" are what dampens enthusiasm on this thread?:)
Don |
