Applied Materials No-Politics Thread (AMAT) Message Board

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

AMAT 256.41

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Dec 19 9:30 AM EST

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To: Sam Citron who wrote (9880)	5/20/2004 11:12:39 AM
From: Cary Salsberg	Read Replies (2) of 25522

Sam, I am considering two possible scenarios. The first is a return to normal cyclical behavior after working through the bubble aftermath. This has been my operative scenario since 2001. Initially, in 2001, I estimated the peak in 2007-8. More recent numbers have moved the estimate to 2007. My "normal upcycle" expects 3 years of 40% earnings growth leading to the peak. Two years of 40% growth produces a double. There are no reasons for the '07 peak other than the expected industry dynamics. The second scenario is one of stable growth without industry capacity induced cycles. I admit that it is an extrapolation of what is currently occurring. It is difficult to determine if current behavior is a transition from bubble aftermath and will morph into the historical pattern expected in the first scenario or if it marks a permanent change in how the industry does business. The second scenario does not expect an '07 EPS peak.

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