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Technology Stocks : LRCX this one looks good
LRCX 160.99+0.2%Oct 30 3:59 PM EDT
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To: Timothy Grimes who wrote (136)3/14/1996 2:14:00 PM
From: Jim Tao   of 142
 
Tim,

I think the write-up you refer to was the article in the section
of "heard on the street". In that article, the "expert" or
analyst say that there are three problems facing the chip
industry: inventory, PC sales slow down, and overcapacity.
And inventory and PC sales slow down are short term problems but
the overcapacity are not. And that is why all the semi equipment
makers like Lam, AMAT and NVLS have been beaten down like this.

Is there any truth in their claim? maybe, because we do see
the chips inventory building up and PC slows down. What I am
not sure is that how profound the impect of chip price and PC
slow down will effect the equipment makers. There are 200 to 300 new fabs planed to be build in the next 5 years
and each of them cost more than $1 billion to complete.
If the capcity is already enough for years to come, why in the
world all the semis want to build another 200 to 300 mew plants?
I tend to beleie that the people who run the busness have a better
feel and insight of the industry. But looks like the stock market
don't think that way. AMAT is a $3.5 billion company, Lam is a
$1+ company and NVLS is a $300+ million company. Three of them
have a pretty large market share of the whole equipment industry.
Those 200 to 300 new fabs mean A LOT OF BUSINESS. And I don't
think all the new plants are just going to be an empty shell.

As for the Lam's price, I don't know what the market will do.
It looks cheap for me at $40 it certainly looks cheaper now.
But there could be more bad news come out, look for a chartlist
to see when Lam will buttom out and buy at price if you still
like the stock.

Jim
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