Ramsey / All,
Here's a contrary view to the public belief that Semi Eq.
stocks are overvalued. Yes, they had an impressive run-up, but
they still look pretty attractive when compared with other industry groups.
The following table lists three key indicators for five key technology groups:
- Price-to-(book+sales) This is the relation of the stock price to
the sum of book value plus sales-per-share.
- Current ratio
- Debt-to-Equity
Each group consists of the five stocks with the highest market cap in the group:
- Hardware: IBM, CPQ, HWP, DELL, SUNW
- Storage: EMC, SEG, STK, NTAP, QNTM
- Network: CSCO, ASND, COMS, NN, ADPT
- Semi Eq.: AMAT, TER, KLAC, NVLS, LRCX
- Semi Mfg.: INTC, TXN, MU, STM, AMD
(Raw data according to Yahoo, as of a week ago.
Numbers are unweighted averages.)
Price-to- Current Debt/Equity
(Book+Sales) Ratio
Hardware 3,15 1,57 0,24
Storage 4,50 2,91 0,14
Network 4,71 4,12 0,13
Semi Eq. 2,20 3,06 0,21
Semi Manuf. 2,52 2,36 0,31
Price-To-(Book+Sales) is lowest for Semi-Eq. You'll get the most
value for you money here.
And financial strength in this group isn't bad either.
As long as SEMI's booking continue to improve, I'd expect money to
flow into this segment. It's basically still buy-the-dips-time.
But that's of course just my opinion. Time will tell.
Klaus |
