Silicon Investor (SI) -- The First Internet Community

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.

Biotech / Medical : VD's Model Portfolio & Discussion Thread -- Ignore unavailable to you. Want to Upgrade?

To: scott_jiminez who wrote (7966)	5/22/2000 4:14:00 PM
From: LLCF	Read Replies (1) \| Respond to of 9719

<In a environment of tightening monetary policy, there certainly is some degree of 'rationalization' for tumbling stock prices, ESPECIALLY for those companies with stratospheric valuations and those with non-existent earnings.> Actually I was also referring to the massive run-up in the sector as well. DAK

To: scott_jiminez who wrote (7966)	5/23/2000 4:03:00 PM
From: satish kamat	Read Replies (1) \| Respond to of 9719

<<I could give you ten rock solid reasons why the stock of Kulicke and Soffa Industries should be trading at $150. It is currently at $45. And this stock has REAL earnings and is expected to earn about $5.50/share next year. >> As some one who believed similarly in the analysts earnings forecast for KLIC and MU in 96-98, I thought I will share the learnings. Anyway, I paid for it. Once the semi book-to-bill (a different kind of B2B)starts slowing --like the one we saw this week, these stocks will become even cheaper. These are notoriously forward looking stocks. I have no doubt KLIC may make 5.50 next year. But as we come off another semi boom, KLIC 2002 earnings may get reduced to 0.50 from previous 5.50. Market being forward discounting mechanism, it is already looking at the b-to-b ratio and includes that risk in the price. OTOH, if the slowdown is short lived, then look out. As we move to 300mm, KLIC will be worth many times more. Current market conditions are due to lack of clear direction - election, interest rates,and lack of clear sector leadership- networks are out of favor, semi's direction is not clear, B2B have to start making strong deals, net bubbles(peapod) are busting. In the case of bio, the initial genomics froth is yet to prove that they can produce blockbuster drugs. All market is looking at how much trouble CLTR is having with it cancer drug or TXB is having with its NOVASTAN. Both of these are big only if they can start selling it. Sell side analysts sold bios to institutional guys on large number of moneymaking drugs that were to hit the market this year. Unless buy side guys see some real proofs, market will continue to be undecided.