Lam Research (LRCX, NASDAQ): To the Insiders Message Board

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Technology Stocks : Lam Research (LRCX, NASDAQ): To the Insiders

LRCX 159.13

-4.4%

Nov 11 3:59 PM EST

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To: etchmeister who wrote (5550)	10/5/2006 9:54:25 PM
From: Jong Hyun Yoo	Read Replies (1) of 5867

"If you like LRCX, NVLS and (VSEA) what is left for Applied? LRCX and VSEA probably took AMAT share and NVLS is going after AMAT in PVD and CVD - so what's the "incentive" about AMAT?. I don't believe AMAT made inroads into copper plating - on the other hand AMAT defends its CMP position" I still don't like AMAT compared to LRCX and NVLS. VSEA is a great play on the implant which is growing faster than the overall market due to many new things happening at the transistor level as the devices approach the nanoscale level. AMAT etch is still struggling. Oxide etch market is still not there for AMAT. Ex-LRCX head is leading the group but no signs of turnaround yet. NVLS lost PVD and ECP market share to AMAT somewhat but in my opinion, is poised to win it back. AMAT is now getting into solar area after getting into the fab service business. I don't like both of these business. It could be a drag on the margin. I think Splinter is changing the whole culture of the company. Instead of revolutionary tool maker that changes the way chips are designed, AMAT seems to be assume the role of just following the customers. I don't like the overall approach of the whole company. One thing it is doing right is the buying back the shares with its huge cash position. Reduction of the share count could generate some earning leverage. But increased competitions on fewer available customer base and getting into non-core businesses to increase the total addressable market really bother me. AMAT should not deserve any premium on PE to competitors such as LRCX, NVLS, and VSEA. Realization of this by the investors have made the stock getting nowhere for a while. In my opinion, PE multiple is still compressing ahead of a little downturn that we may run into. We will have to look for the company that will weather this downturn better with improving margin and choose the ones that can provide the most earning leverage as the peak to peak growth of the uptrun revenue is moderating due to several factors. I am working on the investment thesis on NVLS for my social investment group but did not have time to do it because I have been busy with my job. JHY

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