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Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (3412)	4/16/2001 8:15:30 PM
From: energyplay	Read Replies (1) \| Respond to of 23153

Future Semi recovery, comment on LLTC One of the things I noticed in 1998 was that orders turned up in late September, but stock prices (especially ADI) kept dropping until late October and were still low well into early December. Buying at that time (price was 13-18, went to 34-60 in two years) could have done well. Another thing I saw in the semi world was we would see our stock move up strongly, and then 2-4 weeks later we would see orders turn up. Someone on the analyst side was watching the demand being created before we in the company could see it. Linear Tech (LLTC) Linear Tech is a well run company with high gross margins, mostly proprietary products, and a real diversity of customers. Also about 1 Billion in cash. They will survive, and I believe the COMPANY will prosper. LLTC the stock is heavily owned by insiders and insitutions - not too much Joe Public participation. Short term, the insitutions bother me a little - as they reduce their tech weightings, LLTC will tend to be one of the last things they sell this year. Going forward, the question is, will it be one of the things they buy ? One issue with LLTC is price to sales (the P/S is way high, but P/E is more reasonable - results from high gross margins). Another is growth - can these analog companies grow at better the 1.5-2.0 times World GNP ? If they can't grow enough (more than 10% year), then the P/E and P/S will not recover to where it is today. Somewhat longer term (2002 through 2005) the insiders hold lots of stock, and they are getting older - so they will start to cash out / distribute etc. This may tend to dampen the upside for some of the long term buyers - and so limit the upside. I currently have puts on LLTC, MXIM, and XLNX. My expectation with LLTC is that sometime this summer ALL semi stocks will get taken out and shot- fund managers will want to show that they own NO semis at the end of the month - and everything will get dumped, with many prices going to single digits or teens. After all the comments from Dan Niles , Solomon, and other analysts this dumping may happen real soon. I don't expect LLTC to go that low. One of ther reasons I bought puts on LLTC was they were reasonably priced and the stock was not down that much, so it has more room to fall. After that I expect the stock price to go sideways until late fall to early Spring 2002, then to start up slowly, then jump. Then slow start up will likely occur weeks or even 2-3 months BEFORE orders turn up. The jump may be 2 weeks before or after a big turn in orders. I'm expecting U shaped recovery, with a long flat time, not a V shaped one. I also don't think we get back to the top of the U, certainly not in stock prices. My guess is that we people see there is no V shaped recovery, it will look more like an L , and many people will dump shares. Those are my current (4/16/2001) expectations. I am very interested in any contrary rf additional information, especially anything that points to a V recovery, or even a W - type upside blip. Energyplay