Semi Equipment Analysis Message Board

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Technology Stocks : Semi Equipment Analysis

SOXX 296.92

+0.1%

Dec 1 4:00 PM EST

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To: Donald Wennerstrom who wrote (15861)	6/21/2004 10:22:52 AM
From: The Ox	Read Replies (1) of 95503

Don, Thank you very much for the table you created. Basically, it shows just how perverse Wall Street is when it comes to valuations in the semi equip sector. Starting with a negative $26 in eps for 2002, the industry improved eps by $7.50 in 2003. In 2004, the industry is on pace to improve eps by $33 over 2003 (or over 400% growth from the previous year). Using your estimates for "next year earnings" in the charts you posted for this weeks movement in the group, the sector is expected to improve eps another $19 ( over the $14.25 2004 total ) to $33 ( or over 130% eps growth ). Translated, we get a forward PE of 14 for a sector who's earnings have made monumental improvements, from the depths of depression to an ongoing recovery. I say ongoing because first, the forward expectations are still showing 100%+eps growth and second, based on what the industry leaders are telling us. The disconnect between actual earnings and the underlying stock prices shows just how Wall Street works. It's quite a scam they have going on. Pretty amazing that none of the analysts who cover the sector point out how their "brothers" have completely ignored the fundamental gains being produced by the industry. If eps gains like these were being produced in any other sector in the market, there would be trumpets blaring every day but not in the semi equip sector! NOPE. Here we get, it's the top of the cycle. Bail out. What a joke. From negative $26 and negative $18 in eps to plus $14 to plus $33! But who cares? Certainly not Wall Street or the analysts who cover the sector. What a joke!?!

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