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Technology Stocks : Semi Equipment Analysis
SOXX 297.50-2.6%Nov 6 4:00 PM EST
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To: etchmeister who wrote (36144)10/7/2007 5:14:32 PM
From: Donald Wennerstrom  Read Replies (2) of 95383
 
Etch, One of the problems with the "poor" performance of the SOX is the lack of earnings growth. The table below shows the earnings estimates of the SOX stocks for the past 3 years. I had to do just a little juggling, since there have been some changes over the period, but the stocks below have been a part of the SOX over the 3 years.

-	  9/30/05	  9/29/06	  9/28/07
	 FIRST CALL	 FIRST CALL	 FIRST CALL
	EARNINGS EST	EARNINGS EST	EARNINGS EST
SYM    CUR YR  NXT YR  CUR YR  NXT YR  CUR YR	NXT YR
ALTR	0.76	0.92	0.94	1.14	0.85	1.12
AMAT	0.64	0.83	1.06	1.12	1.25	1.27
AMD	0.22	0.64	1.12	1.35   -2.77   -0.71
BRCM	1.32	1.60	1.35	1.45	1.15	1.39
IFX    -0.30	0.36   -0.23	0.47   -0.49	0.35
INTC	1.44	1.60	0.80	1.10	1.15	1.40
KLAC	2.12	2.43	1.84	2.69	3.17	3.63
LLTC	1.43	1.64	1.58	1.81	1.67	1.94
MRVL	1.27	1.53	0.85	0.97	0.31	0.72
MU	0.49	0.78	0.29	0.90   -0.44	0.03
MXIM	1.68	1.96	1.45	1.73	1.19	1.41
NSM	1.11	1.33	1.29	1.45	1.28	1.56
NVLS	0.91	1.26	1.68	1.74	1.60	1.67
STM	0.27	0.74	0.78	0.98   -0.34	0.97
TER    -0.35	0.56	0.91	0.81	0.58	0.89
TSM	0.53	0.62	0.78	0.78	0.63	0.77
TXN	1.36	1.63	1.70	1.90	1.76	2.14
XLNX	0.96	1.20	0.98	1.17	1.22	1.48
TOTAL  15.86   21.63   19.17   23.56   13.77   22.03

Notice at the bottom line there is very little change in estimates going forward. In any event, this is not a growth story. There is movement up and down with individual stocks, but bottom line, not much change. As a matter of fact, adding the sum of earnings estimates for 07 and comparing to 05, gives 35.80 versus 37.49, a -4.5 percent difference.

Also, predictions for growth in 07 and 08 are being revised downward. Some predictions even say there will be little or no growth, or even worse. This is not a scenario for a robust rising SOX price.
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