Dave,
You keep predicting a slow down ahead for the SEMs. If so then the situation is down right screeching to a halt.
We haven't completely recovered from the last (almost current) slow down of 96. As mentioned on this thread numerous times, perhaps by yourself included, we (AMAT) are just returning to sales and earnings levels seen in late 95 and early 96. It's been 18 months without growth beyond the previous peak, since we just equaled the revenue of 1st qtr FY96. And many companies aren't back there yet: LRCX, NVLS and many more.
You're saying another slow down when we haven't had a growth cycle yet. I guess that's possible. But if this is a growing sector, then usually a growth cycle will reach significantly higher plateaus. Since the last peak was just equaled, I would anticipate a few more years of growth, or else this is an extremely abreviated cycle.
Demand for semiconductors "is" growing isn't it? I now have 56 MB of RAM in this computer I'm typing on right now. A year ago it had, I think, 16 MB. If this is indicative of the general case, then demand for computer RAM more than tripled in a year. I hope capacity isn't being added at that rate. If I'm right, the glut is dwindling away and soon (when?, I give up) overcapacity will not be a problem.
Sorry to repeat myself, but don't you have growth in betwen slow down? When exactly do you see the "slow down" starting? If the current drop is in anticipation of that, and if it happens like last time (6 month prior) the slow down will start in 5 months.
Otherwise this is just a market correction.
Just my take.
Stu B. |
