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To: SJS who wrote (13793)	8/16/2000 5:32:46 PM
From: SJS	Respond to of 14427

What's the skinny about SAWS? Trading opp? _______ Sawtek (SAWS) 42 7/8 +3/4: One thing that drives most investors crazy is when a stock they own drops sharply even though the company reports good news... At this point, SAWS shareholders are probably on the verge of checking into the looney bin as they have watched their stock plunge 42% since July 14th -- the day the company reported the highest quarterly earnings per share and net sales figures in its 21-year history... On a percentage basis, earnings surged 83% to $0.34 on a yoy jump in sales of 69% (sales were also up an impressive 17% sequentially)... Now the stock had run up in advance of its report, so a little selling on the fact couldn't have been that surprising - even to loyal SAWS investors... But a 42% drop? Usually such a decline is associated with some kind of earnings warning... But SAWS has given no indication that business is slowing... To the contrary, management noted when it issued its report that business trends suggest that "the outlook for Sawtek continues to be strong." Late last week, management decided to put its money where its mouth is, as company announced that it would resume its share buy back program because they believe the company is "currently undervalued by the market." Briefing.com agrees... The selling in SAWS has had more to do with market fears of a slowing in the wireless market than any change in the company's fundamental outlook... Sawtek's electronic signal processing components, based on surface acoustic wave (SAW) technology, are used in a variety of microwave and radio frequency systems, such as Code Division Multiple Access and Global System for Mobile communications-based digital wireless systems, digital microwave radios, wireless local area networks, cable television equipment, various defense and satellite systems and chemical sensors... The company's FY00 earnings are projected to grow by 67%, with growth estimated at 28% for FY01... The long-term growth rate is 28.5%, well above that of the market and the industry... SAWS has over $3 a share in cash, little debt, an ROE of 27% and profit and operating margins of 33% and 46%, respectively... In other words, what's not to like? As the market's (exaggerated) concerns over the slowdown in the wireless industry give way to the reality of continued strong growth, look for SAWS to come roaring back... Minor congestive resistance is in the 47-49 area... Penetration of this ceiling would leave the stock positioned for assaults on the 56 and then the 60 areas. -- Robert Walberg, Briefing.com