Zev, I understand your position. I would not presume to counsel anyone on investing in anything. However, I think the following:
(1) The fear about the economic problems in Asia and its impact on semiconductor companies ability to expand is way overblown, and for one big reason: These economies in Asia are still rigged. I have little doubt that the semiconductor industry, which has been both competitive and profitable in the past, will get whatever funds it needs. It is very unlikely that Korea and Taiwan will let this segment of their economy be destroyed in front of their eyes. I think they will view it as a matter of national (economic) security to keep this industry vital and healthy, and that means competitive. The money for upgrades to the new technology will come from somewhere.
(2) The rest of the semiconductor world IS moving to the .25 and under dimensions. It may take a little longer to get production lines up and running than was at first predicted, but the movement cannot be stopped or even slowed much further.
(3) It may very well be that the most important thing to come out of the conference in Japan this week is that (1) will be realized by the market. Furthermore, Cymer will look better and better as time goes on. The next earnings announcement, now only a month and a half away, is going to be nice, and a lot of people know it. I am now convinced that there is a huge following of this stock of people (fairly big market players) who have been waiting to buy in. My source for this belief is C. Johnson's description of Cymer's presentations at AEA and who all was in attendance. There are a ton of deep pockets who know about this story. I think we haven't seen them buy in because of fear about the semi industry in general, which has also kept the short interest high. However the fear may be drying up. If it does, these people are going to start nibbling. Once they do, especially if the short interest catches on, the price could move fast.
(4) Your biggest concern has been a belief that there will be a continuing decline in the BTB ratio. I don't see it (and neither does CJ, at least in leading edge technology) We know that the BTB ratio in the back-end and Test sector is very strong. It seems to me that that forward momentum has to creep forward towards the front end eventually, and we have every reason to believe that in leading-edge technology, the forward momentum is already there (Cymer's next 2 quarters, AMSL's order backlog, etc.)
some rambling thoughts........
good luck, and did you get my packet?
jess |
