DN, I have small put positions on AMAT and NVLS. I don't have any on the smaller players as they are too cheap, absolutely, for me. In fact, Amat and Nvls are also rapidly approaching that point.
Amat, especially, has a huge cash horde. Yes, they are eating into it, but they look like they'll be standing when the dust clears. Perhaps standing at $9 a share, but standing.
The smaller cos. look cheap statistically. Lam is selling near its cash level and below book value. That doesn't impress me enough to buy it, as I am not yet certain that they will survive this mother of all chip cycles. And the cycle is nowhere near over. We are in the middle innings with much worse to come. Klic is another that I have doubts about.
While the US based cos.(es AMAT) try to weather the storm, better financed Japanese conglomerates are trying to grab market share. Our cos. have just started to discover that the money they wasted buying back shares at the top and the worthless stock options they issued now disgruntled key employees have a downside. There is much more to play out in those areas of accounting flim-flam in addition to the fundamental industry problem.
So, I wouldn't put new positions on in this industry long or short. It is too late to make the big bucks on the downside and way too early to bottom fish.
MB |
