Steve,
Re: "I never said .92 was a positive number in and of itself, only that it was positive compared with the expected .86-.88."
I understand that and thought you were partially repeating what CNBC was saying, though that part really doesn't matter.
About how long this downturn could last, more and more I come to believe that it could easily be as severe or more so than the '96 slowdown. Why exactly?? in part because PC growth appears to be slowing, losses in the DRAM arena are vast, and pricing power is very limited even for Intel. Intel admitted in their most recent conference call that their lower end Pentiums are now commodity products. I see a period of weak fundamentals and therefore a period of risk, much more than reward. As Aki and others have stated, we take our positions (or hold cash) in accordance with our convictions.
As you may be aware, the semi-equips have bottomed in previous downturns at Price/Sales ratios of ~ 1.0, varying somewhat from company to company (e.g. LRCX has tended to bottom at a PSR of ~ .7).
Bottom line for me, 1998 could easily be a very rough year for the semi-equips, and the year is young.
Just my thoughts,
Teri |
