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

To: Cary Salsberg who wrote (47187)	5/24/2001 2:38:09 PM
From: trilobyte	Read Replies (3) \| Respond to of 70976

Cary, if you have more difficulty with the current strength, it is because you are speculating that the situation will not improve, or even continue to degrade in the coming months. Others, prefer to speculate that the situation will improve and are therefore holding, or buying, AMAT near current levels. One way or another, it is speculation --whether it is described as a future dream or a nightmare. Investors are not using the April btb to make their decision (that was in any case already included in AMAT's most recent quarter). Instead, they are betting that the seasonally strong sept-march period that is coming up will lead to improvement in bookings and btb. This is not such a difficult thought to entertain, I think, after the long and brutal period of compression we have witnessed. More importantly, if consumers decide to buy new toys, semi companies will have no choice but to upgrade to the new technologies (even if they have excess capacity because it has become obsolete). Finally, valuation: be a little generous! At a run rate of 10billion, AMAT was doing close to 3$ per share. At a small p.e. of 30 (for such a leading global company with tremendous competitive barriers), that's 90$. Isn't it unreasonable to imagine that at 20billion, AMAT will be earning 6$-8$ per share? At a p.e. of 30, that's 180-240$. At a more generous p.e. of 50, 400$ is a possibility. Who wouldn't want to make 3-8 times your capital in 3-5 years? Trilobyte p.s. I continue to hold my AMAT, NVLS, PRIA, ASML, CYMI during these periods of "strength"!