BB,
In one of your posts, you mentioned your belief that AMAT would probably have a run to ~$40 by the end of January. In another post, you said you did not think AMAT would see levels above $41 for 1998. IYO, do you think there is a double-v as it were, a second downturn that could be as serious as the one in '96?
Personally, I think the DRAM market is weak. The 16MB lifespan was incredibly short and the 64MB looks like it will suffer a similar lifespan shortage. Other than the current wakness in DRAM, we should be poised for growth w/ the implementation of 300mm. Right now IMO, there is so much uncertainty that semis don't want to commit their precious capital at a time of shrinking margins. Sooner or later though, they will have to to remain competitive. The question is when. Are you betting that we will see a down year in capex? Specifically though, AMAT is notoriously srtong in all of the previous downturns and has come out of each owning greater and greater shares of an increasing number of markets. Are you skeptical AMAT can weather this storm and keep eps in line w/ mgt forecasts?
IMHO, all of the semis are waiting for a GO signal before they commit heavily in the new technologies. Also, none want to telegraph their intentions to their competitors. Bottom line IMO, is that once INTC, TXN etc. make the decision that there is sufficient market demand and the committment to 300mm is made, there will be a California-Gold-Rush mentality to the newer technology. Would appreciate any insight.
Regards,
Brian |
