Z,
" I'd say the current problems have killed those prospects for at least another 3 years and further competition means there is no end in sight."
Well, perhaps. Depends on how long this lasts. If it is cleared up by spring time, and Samsumg, Hyundai, Fujitsu, et al. don't fire any more salvos for awhile, then the damage may be contained. After all, it is still a cyclical business, and will be so. But it is also a growth business. If the growth part of it is emphasized, and the cyclical downturns are shallower and shorter than before, then they may get somewhat higher PEs than they used to. But I would say that it now looks like I was overly optimistic last spring and earlier when I thought that they might get as high as 18-20 PEs (that is, on normalized earnings, not on depressed earnings--higher PEs on depressed earnings are easy).
I still can't believe that these Korean and Japanese companies can look at the DRAM example in front of them--which they even participate in--and will allow the DD industry to drop to the same profitless, glutted level. Unless they are just into provide employment for their people, and don't care about profits. If that part is true, well.... |
