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Technology Stocks : Cymer (CYMI)
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To: ForYourEyesOnly who wrote (2379)9/21/1997 9:07:00 PM
From: Czechsinthemail   of 25960
 
I've appreciated Cary's posts both for bringing the discussion back from billionaire trading strategies to talking about CYMI and for raising important questions about the company's future. I recently read through some of the company's financial statements, and my understanding is that they are predicting a slowdown in sales related to the interim period between pre-production purchases of steppers and full-production purchases. The uncertainty around the timing and the impact of this event hasn't been discussed much in the last few hundred posts I've waded through. Cary's questions seem legitimate to me. What is the value of CYMI if sales slow down rather than accelerate in '98? A related question would be the impact a slowdown might have on the competitive environment if Komatsu and Coherent have more time to develop their lasers before full production kicks in.

My overall view on the company is positive. But I feel there is more question around this company and how it will do than is generally acknowledged on this thread. That uncertainty translates into selling when people get scared. Though I have a modest long position in the stock, I am trying to get a bead not so much on the short-term concerns (whether production delays will reduce the quarter's numbers) as the intermediate concerns (will there be a slowdown in DUV sales that significantly impact the company and/or a major downturn in semiconductor equipment sales).

One last point, in the press release regarding Nikon I got the sense that both companies denied problems with the company's lasers as the cause of delays in Nikon stepper and scanner shipments but didn't rule out problems related to slow delivery of the lasers. I'm assuming that the quality on the lasers is high, but there may be significant production bottlenecks that slow laser deliveries. This would seem to be another concern around revenue and earnings projections--exactly how many lasers CYMI can deliver.

Baird
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