MEMC INT'L. (WFR -NYSE) The Sleeping Giant? Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : MEMC INT'L. (WFR -NYSE) The Sleeping Giant?

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Proud_Infidel who wrote (4360)	4/30/1999 5:02:00 PM
From: Zeev Hed	Read Replies (1) of 4697

Brian, eventually, yes, but right now, until some more capacity is taken out (like Spartansburg and China), the industry is still operating at 62% of capacity (that is raw wafers production not the finished wafers that the article was discussing), thus you need an increase of almost 35% in wafer demand to absorb this excess capacity before pricing power returns to that part of the business. I have a problem in that I am not sure that even a 30% increase in production will bring WFR into break even until they can shed the overhead associated with facilities planned to close and absorb the cost of requalification for customers (at those closing facilities) to the more modern facilities. I see at least another quarter, maybe two of losses. If these losses are again in the $50 MM per quarter, WFR will be in a cash crunch with little flexibility to expand when the market takes off again in the last quarter. In the CC they said that they have some "shortcuts to expand" and that these are included in their $85 capex. If that is the case, then maybe late in June might be the time to look at WFR again (or possibly wait until the next earning report late in July?) Zeev. Zeev

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next