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Technology Stocks : MEMC INT'L. (WFR -NYSE) The Sleeping Giant?
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To: Scotsman who wrote (3327)5/17/1998 11:26:00 PM
From: Zeev Hed  Read Replies (1) of 4697
 
Actually, MEMC is much less cyclical than the equipment makers (I take AMAT out, since they have a very good habit to use these slow downs to grab more market share). It is rare that the industry does not ship more units year after year, even when sales in semis are down year over years, chip shipments and in most cases, "Si Real estate" shipments keep growing. The decline in wafer prices are usually much slower than the decline in chip prices. Thus under normal circumstances (when the wafer makers do not go on binges of expansion that are greater than expected demand expansion), slow downs in the semis should mean steadiness in the wafer business. Once the ASP of chip stabilizes back onto its normal curve (due to feature reduction), the shipment of wafers should actually increase at a slightly higher rate than the semi shipments (dollar wise) since to maintain let say, an increase of 10% in shipments dollar, the semi must ship at least some 20% more chips.

Zeev

Zeev
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