Elwood, where did you get this article, did you write it? (Specialist, would appreciate your comments to my comments, thanks)
<< However, there comes a time when even the most bullish
investor must acknowledge that extrapolating growth out to the wild blue
yonder carries with it a significant level of risk.>>
market for DUV according to Dataquest is expected to more than double by next year. Dataquest data is not "extrapolating growth out to the wild blue yonder". And Dataquest data has underestimated the semiconductor growth for the past two years. The only extrapolation here is the statement itself "wild blue yonder" which comes from a children's nursery rhyme.
<<What propelled Cymer shares higher was the obvious fact that DUV steppers
will continue to be the purchased for leading edge semiconductor fabrication
for at least the next two years. There is absolutely no other reason Cymer
investors bid the stock up to the lofty levels reached a few short weeks
ago>>
next two years? DUV has capabilities of moving from .25mu to .10 according to Cymer execs. The movement from .25 to .18 is already being developed by Cymer, this would imply a much greater time frame that two years. this type of talk is typical wallstreet misunderstandingisms regarding the semiconductor industry and how it operates. it is possible that a firm could make a major breakthrough tomorrow for .10 relative to cost and process, but the probability is extremely slim given what is known in this universe
<<Other than our observation that the stock was overpriced we could point out
that five other photolithography methods are being vigorously explored by
the device manufacturing community. One example can be found in Intel's
EUV announcement a few short days past. All five methods are targeted for
the production of leading edge semiconductors.>>
tell me; you own 90% of the market share for DUV with "everyone" in the industry retooling for DUV due to its total cost efficiency factors, and EUV approximately four to five years away from production (ten years according to Cymer), with total semiconductor demand growing at 20% this year, Cymer has a working product to help meet that additional demand NOW (not working copies) and you think that companies are going to bet on unproven merchandise?. this sounds like nothing more than a short trader convincing God he has a reason to exist.
<<What we are going to say is that DUV is not going to be around forever and
investors should be cautious when they extrapolate the past growth rate of
Cymer.>>
DUV is not going to be around forever! Neither are stupid ideas! No kidding! It's not that DUV is not going to be around forever, its how long will DUV meet the growing demand for semiconductor chips? Semiconductor chip production is expected to grow by 20% this year and next. DUV occupies a measily 1% of that production process with the expectation of that process moving up 12times over the next two years to 24%. Now, Cymer has done extremely well with 90% of the DUV representing 1% of total production. How well will they do when that production goes to 2%, 3%, even 4%? Even 70% of 4% is a lot more than 90% of 1% and this doesn't take into account the 20% growth of the overall market on top of that! The world is using MORE chips not less. Better etching tools are needed, currently CYMI fits the bill.
Specialist please correct my errors in this, but this article seems to be very biased to one side don't you think? |
