Fred,
The Advest Buy recommendation was issued on 1/20/97, and basically states that they are introducing a 1998 EPS estimate of $0.95 per share (up 58% from their 1997 fcst of $0.60 per share) based on a 1998 Product Sales estimate of $78M (up 54% from their 1997 fcst of $51M). They forecast Contract revenues flat at $10M/yr for 96 & 97 dropping to $8M in 1998.
Product sales are forecast to be driven by rapidly expanding Safe Delivery System (SDS) Revenues, and a probable reacceleration at the EcoSys unit. Although they predict the semiconductor capital equipment market is likely to contract in 1997, the niche served by EcoSys is growing much faster than the underlying equipment market and if there is any decline in EcoSys sales, it is likely to be mild (they also note that there has been no softness to date). Advest claims their model is conservative, and a new contract with a single fab would be incremental to their sales forecast.
SDS is making strong inroads into the ion implant market. It's a patented delivery system offering significant safety and productivity improvements over the current technology. Advest forecasts the strength of SDS sales to nearly double NovaMOS revenues in 1997, more than offsetting any weakness at EcoSys
Advest says they have a high level of confidence in their 1997 and 1998 projections, and are raising their 12 month price objective to $30 per share. This is based on ATMI's exceptionally strong core technology as well as the ability to generate fast growing multiple revenue streams from that technology. Despite its recent strength, the stock still is trading at a 40% discount to its estimated long term growth rate of at least 50%, and finances are healthy.
Aside from the financials, this is the bulk of the report. You can probably get a copy of the complete report by contacting Advest at (617) 348-2310 or calling the analyst, Kevin Clark at (860) 509-2123
Regards,
Jack |
