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Strategies & Market Trends : The Art of Investing

PICK 45.35

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Nov 7 4:00 PM EST

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To: Gottfried who wrote (409)	2/17/1999 7:35:00 PM
From: Sun Tzu	Read Replies (1) of 10550

I noticed that you had a discussion with skeeter about valuations on AMAT. I think his approach to valuation is wrong. In the early stages of recovery from a sever downturn, cyclicals are not valued based on their earnings, rather as a multiple to next year's sales. And that multiple is always highest in the first year or two of the recovery. Based on that, it is safe to say that AMAT should trade at 3x 2000's revenue. You may want to let skeeter know that. I have not talked with him since I called a bottom for MU in 20s and predicted it to go to high 40s (I was modest <G>). Anyway, what is the conclusion of the AMAT thread on the earnings and today's action? Good luck, Sun Tzu

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