Tim, It has been typical of the book to bill to decrease from July through September, look back at prior years data on a monthly basis. July through September are typically the slowest months and then begin to pick up again in November through March. Cymer's book is 1.29. This has been slightly increasing sequentially, not decreasing.
The semis have not had "crappy"earnings. Many have just had some of the best quarters in their history. What is out of context was the analysts earnings estimates. Analysts are known to post unrealistic over estimations and under estimations. If I were an analyst and I was short a particular stock, I'd post an estimate which clearly could not be met. When the company didn't make the unrealistic estimate, the stock goes down. I've won. It goes on. I can name several examples. Kurlak's estimates for Intel is an example. We can have semis growing at a compounded rate of 18% a year, yet estimates show 22%, they grow at 18%, among the strongest growth sectors in the market, and people say they are not growing as fast as predicted and they sell off.
Companies supposedly guide analysts on earnings. But, in fact, they work hand in hand. Keep the institutions happy and no one knows the difference. Its a club.
I challenge you to name one product, or one being designed, which doesn't now require a chip which didn't require such just two years ago. Even toilets require "chips" for automatic flushing. Semis will create the demand for more chips.
I'd look for at least two, if not more, analysts next week to either upgrade Cymer to a buy or reiterate Cymer as a buy. If they're honest, they'll do it. |
