I thought this might be interesting:
Based on earnings expectations for the next 2 years I lumped the semis in these groups:
1. continuing to perform well (aka the "what correction" group):
VTSS, LLTC, ADI, MXIM
2. flattish this FY (-5% to +11%) and very strong rebound (>=35%) next FY:
XLNX, LSI, TXN
3. flattish this FY (-2% to +2%) and quite strong next FY (22-28%):
ALTR, CUBE
4. huge earnings improvements in one/both of next 2 years (aka hmmm):
IRF, IDTC
5. big time sucking wind this FY (< -28%) with s/ rebound next (>52%):
UTR, VLSI, MOT, NSM
6. sucking wind this FY (-16%) but modest recovery next year(+22%):
INTC
7. losses and more losses (aka percentages are n/a for these):
AMD, MU, CRUS, CY
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This translates to:
First group - analog - what pain? - we never feel things unless the gen'l economy tanks - aka the steady growers - + special case VTSS
Second & Third groups - PLD, DSP, Std Cell - Product transitions or ramp up this year but underlying strength of product lines quite good [in spite of TXN DRAM].
Fourth group: Made a big change last year or got lucky with Centaur...
Fifth group: got caught in HDD or communications or commodity products that either did not sell or are going through severe inventory problems.
Sixth group: INTC - one number - $1,000...
Seventh group: Memory is not a nice place to be in and good idea to produce good yields when competing with INTC. (Not sure about CY.)
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Or even more succintly:
Who says semis are uniform? The world is a changing. Now if the market realizes that there are differences. This is not 1996 - at least so far!
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Interestingly:
The first 3 groups have not indicated pushouts in either their fabs or their partners fabs. Groups 5 and 6 have indicated reduced cap. exp. [actually UTR on schedule but using outsourcing less, assuming true for NSM - 10% labor # reduction]. Groups 4 and 7 - I don't know much about - a mixed bag?
Unfortunately for the semi-equips in groups 5 and 6, you have 3 of the bigger semiconductor companies in the country - INTC, MOT, NSM.
Also, as you mentioned, he who maketh profits will continue to make cap exp continues. He who does not reduceth cap exp.
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Shane. |
