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Technology Stocks : Cymer (CYMI) -- Ignore unavailable to you. Want to Upgrade?

To: XBrit who wrote (24610)	4/3/2000 10:53:00 PM
From: Zeev Hed	Read Replies (2) \| Respond to of 25960

Julius, I agree with your assessment of my less than optimistic view of the semi cap industry. It fits with my general view that next year may see a recession and then all these "humongous" expansions of TMSC and the other two major contract fabs may run, once more, into a wall of over supply. Look at the numbers, the three are planning to spend this year close to $5 Billions on wafer fabs expansion, but their total revenues will at best reach $10.5 Billions, they are not generating enough cash to support a growth like this, thus they borrow voraciously and the results might be disastrous (Like L.G. Semicon). The problems with the semi equipment people, of course, is that when the chips just hit a small bump on the road, like a year in which sales growth is less than 15%, the orders to the equip. people vanish. We are already hearing of chip people double ordering in order to make sure they are "in line" for equipment, thus the huge increase in backlog and the record BTB, might vaporize overnight. That has happened before, so I would not be surprised if it happens again. If you look at the scene around, the major driver of the last boom, the PC, is losing its growth rate while new "killer applications" are still limited. The amount of silicon going into a cell phone, or a PDA or even into games is much smaller than that going into PC's, so these have problems replacing lost growth IMHO. I did not expect the peak to be so early in the year (if you remember, I had a "forecast" of $85/share for CYMI before it peaks), and would not rule out another "last hurrah", going into the elections (thus my reentry today in CYMI and NVLS). Unfortunately, I am not smart enough to know if we had the last hurrah or not, and the unbelievable ascent of the SOX until last month might have been it. I maintain that if AMAT breaks $80, the game is over for the time being and looking for the exits might be a wise thing, even if only temporarily so. I surely would not want to stay in CYMI while it slowly drifts down to the $15 to $20 range (my current low forecast for a semi bear market). I know Curly would not mind, but I lack the intestinal fortitude he possesses. Zeev