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.

Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Yaacov who wrote (124045)	1/3/2001 7:28:19 AM
From: Road Walker	Respond to of 186894

Forbes.com Pro Forum: Jonathan Joseph, Chip Analyst By Tara Murphy You should think twice before going bargain hunting in the chip sector, says Jonathan Joseph, a semiconductor analyst at Salomon Smith Barney. Though the Philadelphia Stock Exchange Semiconductor Index has lost 52.3% since June 22, he says that a slowdown in corporate capital spending and waning PC demand will likely keep a lid on these stocks until at least the second half of 2001. Joseph--who covers Intel (Nasdaq: INTC - news), Texas Instruments (NYSE: TXN - news), Analog Devices (NYSE: ADI - news), Micron Technology (NYSE: MU - news) and Advanced Micro Devices (NYSE: AMD - news)--predicts that investors will favor semiconductor stocks once supply and demand issues improve. Forbes.com: Which segment of the semiconductor industry is facing the greatest amount of pressure in the first half of fiscal 2001? Joseph: I think largely across the board. Two things: one is that growth rates are decelerating rapidly, while a huge wave of new capacity will be coming on in the first half. So demand is weakening, and there is a problem with too much supply. PC demand is slowing, but the question is by how much. How long do you expect the semiconductor companies that cater to PC makers to stay under pressure? Certainly for the first half. We have to cut capital spending sharply, and we are beginning to do that. And then, once we absorb capacity, hopefully demand will continue, and it will be off to the races again. These stocks have dramatically come down from their highs. Which stocks look like ``buys'' at these levels? Well, we're pretty cautious on the group. But one of the names we'd keep an eye on is Analog Devices. ADI is a relative outperformer and has a very strong connection to the communications area. So are you saying stick with semiconductors that are communications-related? The communication side will probably be a little stronger on relative basis, but the communications side is looking at slower growth itself. Some analysts say that semiconductors experienced a surge last year when we transitioned into a new microprocessing chip and saw exuberant post-Y2K spending. So even if the group makes a mild comeback, it's poised for a fall because year-over-year comparisons will be disappointing in the second quarter. I don't agree with that thesis. I think the sector is going to continue to be slow into late summer. It will be difficult for the group to stage anything but short trading rallies in the face of that. Related Item: Trader Wrapup: Big Blue Rescued Subscribe to Forbes Magazine Go to www.forbes.com to see all of our latest stories.