"Ah, but the question is whether they have the ability to make 21 micrascans in a quarter."
This has always been the question since the litho group wasn't part of the previous cycle.
"Management assurances are not enough."
What kind of assurances do you want? This is a stock not a CD. This goes to the risk-reward model you are utilizing. If you see this is as a high risk, then examine the potential reward. Do you see reward if they are successful as being moderate, high or very high? That is the analysis I believe you must do when you pick a stock. As Ian aptly put, if you want more certainty, you will pay for it...don't assume once SVGI performs to some degree of satisfaction that it will be trading at below book.....more like 25-35 $/share. If that fits your risk-reward model better, then wait a couple of quarters and see how they do.
"History is not encouraging, and the layoffs last fall can't have helped."
Unless I missed something, what history does the litho group have at the peak of the cycle? SVGL wasn't part of SVGI last go round, so history isn't a metric I see as relevant. As for the layoffs, I cannot comment.....only to say almost all semi-equip companies including AMAT had layoffs during this valley we are currently coming out of. With that said, I hope they didn't let the wrong people go, and kept the "warm and fuzzies" with those they felt they had to let go but didn't want to because The Street demands such.
"The return of orders is, of course, a good sign, but until they show that they can transform their outstanding technology into the volume necessary, this stock remains a Dog. <g>"
IMHO, it can't be a dog until the cycle has come and gone and they haven't gone anywhere. So at the very worst, it is a puppy. I don't see that because the "transformation into volume" is something only SVGI really can answer. I have made a wager they can....and of course pray they do. Only time will tell...but I still can't categorize what the stock is until after the facts are...in which won't happen for at least 1 or 2 quarters...so I will reserve judgement until then.
Just one man's spin....SemiBull |
