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.

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

To: Ian@SI who wrote (36611)	8/10/2000 10:20:44 PM
From: Proud_Infidel	Read Replies (2) \| Respond to of 70976

Ian, One thing to add is that AMAT is not the Gorilla it was during the last cycle. Prior to 1999, AMAT's highest net margin was 15.1% if my memory serves. This past Q it was 22.1% and will probably continue to rise. AMAT also had about one-third of the front-end market then. They have more now and their goal going forward is 50%. AMAT can now offer total solutions to customers and manage inventory, something no other company can. How many companies in the world show this kind of promise and profitability? Using prior multiples would assume similar market conditions, and a similar company, of which we have neither. Wouldn't one expect a company such as this in an industry which is the cornerstone as life as we know it to garner a multiple at least similar to KO? Apparently the market values a slow-growth(but somewhat consistent) sugar water maker over the premier technology name of the 21st Century. Amazing! BK

To: Ian@SI who wrote (36611)	8/11/2000 9:21:50 PM
From: Demosthenes	Read Replies (1) \| Respond to of 70976

Ian, hheislmier posted the following post explaining his opinion as to why semi equip cycles would become less violent. (I printed it and have read it everyday since it was posted). Message 14129265 Katherine chimed in lately and took that post apart piece by piece. She seems to think the cycles will continue to be dramatic because of greed and the quest for market share haven't changed. She pointed out some serious flaws in the "300mm-automation-fab-flexibility-argument." Captain Morgan sees "a decade of opportunity ahead," whatever that means. I seem to recall you saying some time ago that you intend to be get out of your equip positions while they are making new highs during this extended up cycle, i.e., that you have no intention to hold through the next down cycle if it can be avoided. 1)Do you still intend to do so? 2)Do you think the cycle will moderate? (I think you have said so recently.) And if so, can you balance your argument effectively against the historical precedent of greed/mkt/share over-spending that usually takes us over the cliff. I always appreciate your thoughts. D

To: Ian@SI who wrote (36611)	8/12/2000 10:14:47 PM
From: Cary Salsberg	Read Replies (2) \| Respond to of 70976

Ian, RE: Morgan expects to better a $20B company before this cycle is done. As far a public consumption is concerned, Morgan joins those posters who don't beleieve the cycle will end. So, his $20B is questionable. Since capacity is curently $14-15B, I am not sure that they will achieve margin improvement bringing on added capacity at the end of the cycle and not sure they will reach $20B. But giving you a $6 EPS, my target goes from $90 to $120. I think that the market PE is for growth, not for cyclicals and the semi-equip warning flag has popped up prematurely and is not likely to completely fade from view. 20 PE it is.