Reuters, Wednesday, November 12, 1997 at 14:13
By Jeff Mamera
NEW YORK, Nov 12 (Reuters) - Shares of SpeedFam
International Inc and several other semiconductor equipment
stocks declined on Wednesday, continuing a slide analysts said
was linked to ongoing concern that weak economies in Asia will
cut into the companies' profits.
SpeedFam shares were off 4-1/8 to 29-7/8 in early afternoon
trading, down from a year-to-date high of 60-14/16.
Other semiconductor equipment-maker shares that fell
included Kulicke & Soffa Industries Inc (NASDAQ:KLIC), off 1-3/4 to
27, and KLA-Tencor Corp (NASDAQ:KLAC), down 2 to 41. Novellus
Systems Inc (NASDAQ:NVLS) was down 7/16 at 40-1/2 and Ultratech
Stepper Inc (NASDAQ:UTEK) off 1-1/8 to 25-1/4."
"These things are still going to test the lows that got
reached in the last couple of weeks," said SoundView Financial
analyst Michael O'Brien. "There's so much nervousness out
there."
O'Brien said the nervousness stems from recent worries over
weak Asian economies. The weakness would potentially mean chip
makers will limit spending on new plants and equipment,
impacting equipment makers.
Yet, while worries about Asia have sent share prices down,
the equipment-makers' actual order patterns have not
diminished, O'Brien added.
"Everyone is still reporting very robust numbers, but the
fear is that out into the second-half of 1998 you may see some
(order) cancellations as people deal with over capacity,"
O'Brien said.
SpeedFam, for one, was down Wednesday on general industry
fears prompted by the Asian concern, analysts said.
Investors worried whether SpeedFam's recently signed
purchase-order agreement with Korea will be jeopardized if
Korean companies do not get the financing they need to continue
expanding.
Officials at SpeedFam were not immediately available to
comment.
Other analysts, including JW Charles Securities analyst
Allan Roness, said despite the share decline, SpeedFam's
business is fundamentally sound.
"SpeedFam in its field is definitely, technically, a
leader," he said, adding, "They're supplying to a bad
industry."
Some analysts see the decimation of chip-equipment maker
shares coming to an end soon.
"My impression is they are going to start hitting a bottom
point," said SoundView's O'Brien.
That bottom point might be later this month, when Applied
Materials Inc (NASDAQ:AMAT) reports quarterly earnings, he said.
Analysts are expecting strong results from Applied, according
to O'Brien.
Applied Materials shares stood off 1/2 in early afternoon
trading Wednesday at 30-5/8. |
