*AV*--I am in total agreement with you. The techs we talk about here have been overly beaten and will be seen as value plays real soon.
Curiously, it seems that this sector is sometimes viewed as the front runner for things to come and, as such, more and more of the stuff I read ands receive is now unequivocally stating we have hit bottom.
So for the record and for putting a stake in the ground, WE ARE at the bottom. I said this before and most of the stocks really haven't gone any lower. the problem is Asia, Great Britain, and over valued blue chip stocks in the US. We have been scraping our knuckles on the bottom for awhile and something has to give.
Mark my words, there will be a huge slingshot effect within this industry much like a Dam bursting wide open. the floodgates of new fabs, new processes, new devices, forced upgrades will choke the supply pipeline in this industry when it turns. It is really freaky. In my 20+ years, I have never seen an environment such as this.
And the really scary thing is that the end user of the equipment or the ICs are going to get ravaged bigtime. DRAM prices have firmed up and have risen slightly (no where near historical prices but at least they are not falling) and you must remember the Litho Tool comment of raising the prices of the DUV tools because the market will bear it.
Watch out, that was just the first shot across the bow of the ship. Wait until the design floodgates open up and the DPMI, MASK, PLAB machine gets rolling on the Phase shift, OPC, etal. higher end tooling and higher margin reticles grow in demand. I am not sure who will be printing money faster, them or the US treasury.
Do not mistake this enthusiasm for the sector as the signal to buy now. I still haven't figured that out and have moved my mid 1999 opinion back to the end of first quarter 1999. However, what I want you to get from this post is that the Dam will burst and the floodgates will not be able to control or handle the onslaught of equipment and chemical orders to handle the upcoming demand. I will ventur a good guess that the top tier equipment companies will exceed historical high values. for some of them, like CFMT, you are talking about 5-7 fold increases in prices.
Millionaires will be made on this next recovery period and each and every one of us can particpate when the time comes.
Andrew |
