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Technology Stocks : Semi Equipment Analysis

SOXX 306.04

0.0%

Dec 26 4:00 PM EST

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To: Donald Wennerstrom who wrote (44529)	6/15/2009 8:51:47 AM
From: The Ox	3 Recommendations Read Replies (1) of 95639

Don, If you look at the estimate changes since the first of April, the gap in your table, we see a dramatic divergence between the SOX and the Group. Next year estimates for the SOX have improved from $5.22 to $8.13 while the Group's numbers have slid slightly from $1.68 to $1.60. Looking at the charts of the SPX and the SOX, one might be inclined to say they've rallied sufficiently (like bob seems to be saying in the previous post) that we should see a backfill move. However, the dramatic increase in future earnings expectations from the SOX since the start of April -- up 55% -- might suggest that there is plenty of fuel for this rally to extend further. On March 27th, the SOX closed at 240 and has risen just under 15% as of Friday. A great run for the index, no doubt, but the substantial rise in future earnings expectations would seem to suggest that there may not be a rush to bail out of these stocks. EDIT: I'd like to add that the forward PE for the SOX, based on next year's estimates in the table, has dropped from 46 to 34 since March 27th. TO

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