KLIC is not in the front end, it's in the back end, just like COHU and TER. The back end companies may see a recovery shortly before the front end companies, like NVLS and AMAT. But KLIC doesn't see a recovery for several quarters, even though the bottom may be here. This downturn's resolution will probably consist of a long bottoming (several quarters) period, rather than a neat "V" shaped bottom. Historically, equip stocks bottom in the month or so prior to increasing order trends. This seems to be nearly a year off by most accounts.
I haven't any idea when the equip stocks will reflect the actual business conditions, but I do know that today's prices (especially in NVLS) are gifts to current shareholders. The next major event will be AMAT's report in 2 weeks. That will move the market in some direction.
BTW, Robertson Stephens just cut NVLS numbers from $1.65 to $1.31 in 1998, and $2,00 to $1.40 in 1999. Maintains LTA. Estimates for $.10 in Q3, $.15 in Q4, $.17 in Q1, and 50% sequential growth from Q1 to Q2 to Q3 to Q4. I think this is a tad optimistic, so I'd expect to see estimates for 1999 trend closer to $1.00. Either way, NVLS is getting more expensive.
Good luck to all.
Todd |
