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

To: Alastair McIntosh who wrote (56661)	11/30/2001 9:15:37 AM
From: michael97123	Respond to of 70976

Al, In your scenario, which is a reasonable one, the only bright short term prospect for amat is a continued market rally fueled by excess liquidity. In that scenario amat becomes a value tech stock and this quarters results will be overlooked and the market will focus on the 13 billion-20 billion down the road. I am thinking naz will get to jacobs 2080 but may have more trouble than i had thought getting back into 2100-2300 old trading range. Nas at 2080 gives us amat at 45 or so. If we fall from that point your $30 price seams reasonable as a low. mike

To: Alastair McIntosh who wrote (56661)	11/30/2001 10:48:59 AM
From: Cary Salsberg	Read Replies (2) \| Respond to of 70976

The $20B in 2005 comes from AMAT and more recently Lehman. I have posted $12B since Morgan predicted $20B last Spring. I think $20B in 2007-8 is more reasonable. The industry overcapacity issue is real, but is not as bad as it seems. It is not the normal case where the normal secular growth of semi sales is outstripped by new fab capacity coming online. Semi sales have fallen dramatically and so have equipment plans and orders. When inventory issues get resolved and the economy reacts to fiscal and monetary stimuli, semi sales will start a new secular leg up at record, but not bubble, rates. It will take a while to grow sales back to bubble levels, but those levels will be surpassed in an orderly and sustainable way. This rapid growth and the accelerating technology roadmap will move AMAT to the $20B mark in the 2007-08 time frame, and will reward patient semi-equip LTB&Hs. I have called for lower semi-equip prices for most of 2001. I have been surprised that it took a terrorist attack to get prices into my buy ranges for both semis and equips and that they stayed in those ranges for so short a time. I believe that the quality companies I have bought, AMAT, ASML, KLAC, NVLS, ALTR, XLNX, LLTC, MXIM, have been given a "quality premium" by the market. I believe current prices don't reflect historical valuations or current business conditions, but I have given up thinking that I will see appreciable declines. While sales levels will reach bottom for the equips in these next 2 quarters, the time to recovery is growing shorter by the month. As I said in early October, if rotten business and terrorist attacks don't result in historical valuations, what will?