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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (48876)	11/14/2001 9:47:10 AM
From: slacker711	Respond to of 54805

one of the reasons the PSR can be useful in looking at cyclicals is that when earnings trough, they can be very low or negative. however, the sales level is less volatile than earnings. e.g., take a cyclical like Cisco--its revenues fell 32% YoY, but earnings fell 89%. The reason that I brought up the fact that TI is almost a pure play semiconductor company (which I assume is what led you to bring up Micron's valuation) is the fact that their business is not behaving like a typical semiconductor company. Fab utilization has gone way down which would lead you to believe that prices would also see a dramatic drop....this hasnt happened. They are not losing money hand over fist like Micron. I am willing (and able) to look at the valuation of TI...but if you want to look at the semi companies as a whole I think I will pass. Most of the companies in the semiconductor industry dont have the barriers to entry that I usually am looking for in a business. Slacker