In general, over the past few months, sector stocks hammered on earnings have rebounded a point or two almost immediately. This may not apply to PLAB, though, as the market was expecting some earnings consistency and lowered earnings hadn't really been priced into the shares -- i.e., this was really a surprise, unlike say KLIC or AMAT's preannouncement.
I'd stay away, to tell you the truth. If you're betting on a recovery and huge gain, you might as well pick a product whose demand (and share price) will go through the roof when the industry starts buying. Which is to say, anyone except mask co's, and possibly co's with strong products outside semi equipment, like Teradyne and Cohu (although they are strong). Also, I personally would watch for companies that might not make it, like IPEC and Brooks, or companies whose technology is suspect or is already losing market share, like IPEC, maybe EGLS or Semitool (whose copper technology seems to be getting shunted off to the side). I don't follow either Electroglass or Semitool so feel free to correct me if I'm wrong.
But there are ten or fifteen very strong players in the sector, plenty enough for diversity. I'd look for co's with positive earnings during the downturn, just to ensure the R&D money is flowing and there won't be capitalization problems with ramp-up. |
