Wow! a good day for SMTL up 1 5/8 or 13.41%!
For what its worth following are some data
and observations:
-1- Many of the big players were down today:
LRCX down 1 5/8, KLAC down 1, AMAT down 1 1/2
NVLS down 2 3/8
-2- I noticed a number of smaller caps up including
HELX up 1, FSII up 7.33 pct, GSNX up 7.32 pct. The
biggest gainers reported in StockSmart's semi industry
list seemed small caps : CSYI up 16.67 pct, ESS Tech up 14.55 pct
and Semitool was next (3rd on the list), FUSN up 13.41 pct
and Tower Semi up 9.89 pct
StockSmart now reports SMTL having a PE of 13.4 (HELX which
I also hold is at 14.4) while bigger cos are reported trading
at much higher current multiples: 20, 30 or more(except NVLS). This is due to sharply lower earnings in the short term and
high expectations for the market longer-term due to the good
Book to Bill numbers.
Before and during the recent runup I thought investors may look toward smaller caps for value, so I sold a portion of stocks that appeared to me quite fully valued in the short-term like
LRCX, KLAC and put them in SMTL and HELX which were relatively
cheap. Well, let's see what happens, but I guess there were
other people out there today with same reasoning actively buying small caps, which news programs are also reporting are interesting the institutional guys. Now, LRCX KLAC etc may run up much further over time but I expect volatility short-term and if SMTL
runs up further to some target range I may sell a portion of
SMTL and buy back larger stocks (LRCX went down to the 32 range
during the Greenspan panic, for example). (I keep two sets
of stocks in each case: for short term trading and long term hold, I use my tax deferred accounts for short-term trading and have
same stocks also in taxable account long term, bought at various times for dollar cost averaging). But for the moment I hold
and wait.
-3- Re: SubMicron: these guys dont seem to be doing too well
they were down 1/16 today. On StockSmart site consensus estimate
for 1996 earnings are a loss of $14 million or 0.94/share.
1995 earnings were 0.21 /share. They are roughly the same size
in sales as SMTL. SMTL by contrast had earnings of 1.27 in
95, estimate of 1.09 in 96 and estimate of 0.87/share in
97. My expectation is that if SMTL can show better earnings
than above, their share price should have further to go. Also I
am very curious as to whether the postponed shipments in last
quarter will show up as a blip of a better earnings report
at the end of this month. It wouldn't surprise me, also now
that SMTL has laid off some people. |
