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To: Math Junkie who wrote (31911)	8/13/1999 3:23:00 PM
From: Proud_Infidel	Respond to of 70976

Richard, The forward looking p/e currently stands at about 25, well below other companies with a growth rate a fraction of AMAT. And this is using FY00 EPS of $2.75, numbers not reflecting the ramp in earnings estimates which are surely on the way. BK

To: Math Junkie who wrote (31911)	8/13/1999 3:44:00 PM
From: Paul V.	Respond to of 70976

Richard, So everything depends on expectations going forward. Correct. Compare the Orders, shipments, BTB, IBD R/S data and Industry price rankings and AMat prices ranges. Normally, compares against the data from the previous years. If they do AMAT should see a bounce. Check July, Aug. and Sept.'98 BTB, orders and shipment numbers and compare against current years numbers However, WS will be listening to CEO Morgan on CNBC Wednesday morning and the conference calls. Naturally, the above is only my opinions and the data which I have reviewed from the Dorsey Wright site, IBD and SEMI sites. Readers are reminded the old saving, "caveat emptor (buyer/reader beware)." Paul 1996/99 YEARS MTH Odrs Shpmnt Act BTB Prc. Rg R/S Ind. Pr Rk JAN'96 (Low # best) FEB'96 1687 1243 1.1 MAR'96 1447 1256 1.15 APR '96 1361 1354 1.01 MAY'96 1187 1366 0.87 JU'96 1175 1354 0.87 JLY'96 992 1311 0.76 22-25 <10 AUG'96 882 1248 0.71 23-27 <10 SEPT'96 778 1119 0.7 24-30 11-15 OCT'96 833 1072 0.78 26-30 11-27 NOV'96 952 1062 0.9 27-40 15-79 DEC'96 1078 1069 1.01 35-40 60-87 JAN'97 1116 1034 1.08 36-49 65-94 FEB'97 1101 1029 1.07 41-55 90-95 MAR'97 1265 1102 1.15 44-54 94-95 APR'97 1386 1261 1.1 45-55 94-96 MAY'97 1421 1299 1.09 56-72 95-97 JU'97 1487 1375 1.07 58-75 95-97 JLY'97 1659 1476 1.12 74-95 95-97 AUG'97 1400.5 1536 1.1 89-108 96-99 SEP'97 1468.5 1672 1.06 92-104 OCT'97 1518 1793 1.02 52-31(split) NOV'97 1595.1 1598 1 40-29 DEC'97 1589 1559 0.99 35-26 JAN'98 1515.7 1458 0.93 27-34 40-58 FEB'98 1382.5 1369 0.9 38-35 70-44 MAR'98 1240.1 1370 0.82 32-36 62-36 APR'98 1136.9 1416 0.78 39-34 60-44 MAY'98 1107.1 1361 0.81 39-31 42-22 192-19 JU'98 932.7 1265.5 0.74 26-32 20-28 Jly'98 717.6 1112.1 0.65 28-34 22-54 AUG'98 571.6 1011.8 0.57 37-25 38-56 SEP'98 481.3 845.7 0.57 23-27 38-50 OCT'98 638 852.3 0.75 22-36 40-65 NOV'98 767.2 913.6 0.84 33-43 62-86 123-10 DEC'98 883.4 920.9 0.96 38-47 92-96 9-2 JAN'99 996.7 890 1.12 46-64 94-96 2-5 FEB'99 1028.8 845 1.22 56-71 94-97 4-7 MAR'99 1256.9 943.5 1.33 55-67 95-97 5-7 APR'99 1405.1 1099.1 1.28 49-68 82-96 48-52 MAY'99 1471.2 1179.2 1.25 53-67 82-88 91-48 JU'99 1448.91 1169.5 1.24 57-75 86-94 98-14 JLY'99 71-79 88-92 91-19 AUG'99 71-78 90-94 50-30 SEP'99 OCT'99

To: Math Junkie who wrote (31911)	8/13/1999 3:50:00 PM
From: Andy H	Respond to of 70976

Good point. Some perspective on a way to value AMAT. All numbers quoted here are intended to be adjusted for splits to better compare to today's prices. Since AMAT is in a cyclic business, some history about peak earnings multiples may be useful. At the August 1995 peak of $30, AMAT had a PE of only 15 based on its peak earnings for that cycle of around $.50 for the quarter ending 4/96 with sales of 1.1B. Note that the price peaked with the Aug 95 earnings. At the August 1997 peak of around $54-55, AMAT had a PE of about 23 based on its peak earnings of $.60 for the quarter ending Jan 98. Again the stock peaked well in advance of the cyclic top in sales and earnings. At a recent price of $75 and an assumed peak PE of 25, which is slightly higher than the 1997 peak, you get a $3 per year run rate or $.75 per quarter to justify the current price. From there, you can run with margin assumptions to find out what sales would be required to get to any given earnings number. For example, in AMAT's best year, ending 10/96-a 14.46% aftertax margin resulted. At a 15% margin and 400mm shares O/S, 2 billion of sales would yield 300mm net income or $.75 per share per quarter. To reach $100 price per share with 25 PE, a $4 run rate or $1 per quarter is needed. 2.666 billion of sales at a 15% margin would get you to the $1 per quarter run rate. If you are comfortable with higher margins and/or PE multiples, sales obviously do not have to come in as strong for the cycle. Something to think about.