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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (31841)	8/11/1999 12:41:00 PM
From: Jeffrey D	Read Replies (1) \| Respond to of 70976

H&Q AMAT 3rd quarter analysis of 08/03/99. Note their view on bookings as opposed to Needham's view. Jeff << Anticipating another great quarter: Applied will announce its July quarter earnings on August 17, 1999. We expect another great quarter, continuing the series of results that beat street expectations by wide margins during the last four quarters. For FQ3, we now estimate $1.4 billion in revenue and $0.56 EPS, which were revised from $1.3 billion and $0.50, respectively. Continued sequential growth in orders: We believe that bookings during the July quarter may amount to approximately $1.5 billion, sequentially growing by nearly 8% from the April quarter. This set of estimates yields a book-to-bill ratio of approximately 1.07, which is lower than the June average book-to-bill ratio of 1.19 for front-end equipment. The continued sequential growth of bookings, albeit at a moderated rate, is consistent with our expectations. Given that a majority part of the company's FQ4 falls in the summer time, and the possible effects of Y2K transition, we project that the company will exit the fiscal year with orders slightly above $1.5 billion. Product lines and customer segment: We believe that CMP continues to be a hot sector with very healthy contribution margin. HDP CVD is also expected to show strong growth during the quarter. Foundries will likely account for a large percentage of the company's shipment and orders (30-40%). In light of a major foundry player doubling its 1999 capital expenditure just recently, we firmly believe that the foundry sector will continue to outpace our capital spending expectations. In our view, Applied remains one of the best-positioned companies to leverage the foundry trend. Business pull-in: Compared to our expectations, Applied is pulling-in its businesses, measured in bookings, shipments and earnings, by roughly a quarter. We believe that this is in part a reflection of the company's effort to streamline its internal operations during the last downturn coming to fruition, and in part driven by the faster than anticipated progress in the global capital spending environment. As a result of the accelerated business momentum at Applied, we are raising our estimates. Raising estimates: For the July quarter, we are raising our revenue and EPS estimates to $1.5 billion and $0.56 from $1.4 billion and $0.50, respectively. We are also revising our F2000 projections to $2.70 EPS on revenues of $6.66 billion, from $2.50 EPS and $6.32 billion revenue. Recommendation: We reiterate our BUY recommendation on shares of Applied Materials. >>

To: Proud_Infidel who wrote (31841)	8/11/1999 12:52:00 PM
From: Jeffrey D	Respond to of 70976

In H&Q AMAT analysis of 8/3/99 it mentions increased capex spending. The following today from H&Q in regards to TSMC. << Date: 8/11/99 TSMC raises 99 capex yet again, underscoring strong demand TSMC raised its 99 capex forecast yet again to $1.24 bn (Taiwan spending) from $1.1 bn, bringing expected group spending to $1.6 bn in 1999. This comes on top of sequential sales growth in July of 15% over June (and 117% over July 98). We believe the heroic upward revisions in spending made over the last couple months are a response to extremely robust demand indications from customers, and are the clearest signal TSMC can give regarding its medium term outlook for orders. We re-iterate our BUY rating.