To: Stitch who wrote (7169 ) 10/4/1999 10:11:00 AM From: Robert Douglas Read Replies (1) | Respond to
Hi Stitch and everyone,THIS WEEK: A Double Header - Veeco Instruments (VECO) and Ultratech Stepper (UTEK) In our view two stocks in our universe are trading at relatively low valuations compared to their previous history and when compared to other semiconductor equipment stocks. These two stocks are Ultratech Stepper (UTEK, Attractive, Target $20) and Veeco Instruments (VECO, Attractive, Target $40). Both stocks are suffering under the dark clouds of the disk drive industry. In our opinion, the disk drive industry is likely at or near one of its normal cyclical lows. The cyclical behavior of the disk drive industry is shorter than that of the semiconductor industry and it is likely that we will see some sort of an upturn in the not too distant future. Both Ultratech Stepper and Veeco are closely associated with the disk drive industry and as such have seen both their financials and stock prices decline. Both companies are in strong financial shape and in our view have relatively little downside risk from here, especially Ultratech which has a book value of $9.96 and a cash per share value of $6.92 Like all of our other stocks, the only time to get a good value is when investors seem to be turned off as is the case now. Investors may have to be patient, however, as it is unclear as to when or how quickly the disk drive industry will recover.
