Terry, yesterday's IBM news was old news. IBIS has been working with IBM for well over a year. First, IBM bought an IBIS 1000 implanter for product development. Then, IBM decided to buy two more for volume production. IBIS issued a press release on 5 March 1998, when the big sale to IBM was finalized. IBIS issued another press release on 9 June 1998 when the implanters were delivered to IBM. It's no surprise that IBM is now set up for production.
Analysts and investors familiar with IBIS knew all about the IBM work because the sale to IBM was the largest in IBIS's history. This work was fully priced into IBIS before yesterday. Somehow, people who never heard about the IBIS-IBM connection before yesterday all heard about it yesterday and decided to buy. I decided to sell today, and I'm sure that quite a few long-timers will also sell in the next few days. Look for a significant pullback, maybe all the way to the pre-news price.
What people seem to be forgetting is that IBM prefers to build all of their semiconductor equipment in house, rather than to buy it. In order to make the sale to IBM, IBIS had to agree to license their technology to IBM, so that IBM can build their own implanters. Although IBIS will get a royalty, there will be no huge equipment sales to IBM in the future. This point is really misunderstood by people who are new to the stock. |
