Dave, Like our friend Early, I tend to be Early on up cycles just as I am on down cycles.
Stocks like Lam are intriguing, but, I don't think we are anywhere close to being near the bottom of the chip cycle yet. We are currently running on back to school and Xmas adrenaline. The bottom of the business could hit as soon as next Spring.
I don't really look for an actual upturn. That is usually too late to make the big and the easy money. I tend to buy right in the middle of the worst times. I have a shopping list of chip and chip equipment companies I would like to buy if they are priced correctly when that time comes. Among them are Amat, Analog Devices, especially if I can buy the convertibles, C-Cube (I know, I've smeared their name all over SI and Prodigy, but there is a price where this is a decent bet), TXN and the gallium arsenide usual suspects.
Cash impresses me because it makes a stock attractive for takeovers. And Lam was smart to build a war chest. Compare that to MU digging a canyon of debt. Still, with the business bleeding that cash every day, I am not feeling froggy and am not ready yet to jump.
MB
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