<<Please explain this comment:
<Anyway, TER is going up because it's underfollowed and the analysts are just getting around to figuring out how it stands in relationship to the strengths and weaknesses of the wafer fab segment.> >>
I meant two things. First, the overall btb for wafer fab in Sept. dropped from 1.09 to 1.07, but the more specific btb for test equipments was extremely robust, over 1.2. Second, although about half of Teradyne's sales come from outside the U.S., roughly 2/3 of this comes from Europe and only 1/3, or about 16% of total revenues, come from Asia. So when the semi (and especially wafer fab) stocks tanked this month and last, based largely on those two factors, Teradyne's stock price was incorrectly punished for factors that largely didn't apply to it.
Since then we have seen a very strong recovery in the automation sector, but it seems to me there is still unexplained weakness in test equipment. You can never be sure that there is not a fundamental problem rather than an illogical market underevaluation, but that's always true. I worry about TER because of insider sales in August and EGLS because of the extreme softness in stock price, but both seem to be trending up now. |
