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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: James Calladine who wrote (1136)	9/10/2001 3:07:21 PM
From: scott_jiminez	Respond to of 95520

<<Yes, some products may require new technology in order to be made economically, but there is not much evidence to suggest a rush to retool (at least at this point).>> There would appear to be some disagreement on that issue. This was posted on the KLIC/Yahoo thread this morning (my emphasis): ------------ Investment in KLIC (or other equipment stocks) is obviously a risk-filled proposition at any point in time. While we have had a tough time of it of late, a powerful argument could be made that there is much less risk in the these stocks now compared to a year . There are indeed some signs of life as increased activity within certain areas have begun to emerge; it’s always absurd to attempt to call a ‘bottom’ for a long term investor. To those who believe this appears to be a good entry point for a 18-24 month commitment of funds, well, you wouldn’t get much argument from me. Regarding Kulicke and Soffa: KLIC is a either good hold or a great buy at these levels. Overall, they’ve done an excellent job constraining costs during this contraction and their overall business has been holding up well given the environment. Their end markets have broadened with Flip Chip and XLAM (now labeled ‘K&S substrates') rapidly approaching end user status. While KNS plays in the same markets as ASMI (not exact, but similar), the company as an unusually high measure of end-user brand loyalty (which is a reflection of the quality and of their products, generation after generation). The reliability of return business from clients not only guarantees a large order backlog when the recovery enters high speed, but it translates into the strong likelihood that the same clients will use KNS’ newer product lines. This is already occurring with Flip Chip; we’ll probably soon see evidence of similar activity in the substrate and testing divisions. Thus the company is now diversified into several end markets; based on the early signs that I can see, I would expect them to beat their current guidance for the upcoming quarter. I believe the bottom is occurring as I write this and the recovery will become most evident in late Q3 early Q4. While there remains some production equipment that will absorb some of the increased, recovery-based, activity, the level of retooling (for 300mm, copper, etc.) will be unprecedented. This is almost universally unappreciated. KLIC is well positioned for these transitions as has been shown at their recent presentations at Semicon West and at the SG Cowen Technology Conference last Thursday. The idea that company will be establishing novel sources of core revenue streams is on target. KNS should no longer and must not be viewed as a pure capacity play in any sense of term. The spate of FCT licenses in the past couple of months is just a small indication of non-capacity related revenue sources that will play a larger a larger role in the company’s revenue stream. This is happening right now, it is a significant positive change towards diversity, and it will be reflect in the speed with which KLIC emerges from this contraction. In sum this means KLIC’s earnings recovery in this and future cycles is not nearly as dependent upon waiting for chip makers to redeploy their capacity-buy investment capital. This means, in my view, it would be a mistake to assume that KLIC’s earnings recovery will have to await the return of capacity buys in the industry. The 2001 version of KNS really is quite different than in previous cycles. In fact, KNS is quite a different company than 18 months ago. The change has been 5 years in the making and it’s about to result in some quite pleasing outcomes. kburg ------------ messages.yahoo.com

To: James Calladine who wrote (1136)	9/22/2001 5:52:47 PM
From: Return to Sender	Read Replies (1) \| Respond to of 95520

TSMC Expects Five Times The Profit In Q3 e-insite.net Online staff -- Electronic News, 9/21/01 Hsinchu, Taiwan-based Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) today announced some rather surprising news, given the current economic climate. The company said it is increasing its financial guidance for the quarter. TSMC (nyse: TSM) now expects its third quarter operating income to be at least five times greater than the previous quarter, when it reported net income of about $9 million (312 million Taiwanese dollars). The company said it expects its operating performance to increase further in the fourth quarter. TSMC said its monthly sales revenue hit bottom in May and June. Operating income then outperformed the company’s forecasted growth rate in both July and August. The company acknowledged last week’s terrorist attacks and the associated slump in global stock markets but it reaffirmed this gradual trend of recovery. One factor for this revised growth, the company said, is that orders received for September through the end of the year show a high concentration of high-end and more profitable products.