Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Return to Sender who wrote (2265)	3/13/2002 9:26:50 PM
From: JSLyons	Read Replies (1) \| Respond to of 95597

Thanks RtS for the research note. I know I'm prejudiced (ie long big-time KLIC) but find it hard to believe this dominant player in the back-end was not included in Maire's list. Rgds, Jonathan

To: Return to Sender who wrote (2265)	3/14/2002 6:31:05 AM
From: scott_jiminez	Read Replies (2) \| Respond to of 95597

Bear Stearns: General impressions: 1. The report seems to be more apropos for last September, when the visibility really was zilch, then for now when we've seen the fog beginning to lift for many companies. Moreover, there seems to be confusion in their opinion: on the one hand they claim visibility is 'limited', but then proclaim to know that the 'current up-cycle will be more technologically driven than previous cycles...'. If visibility is limited, then not only is the 'slope' of the recovery unclear, but the nature of the technology vs. capacity character of the up-cycle is also unknown. 2. Absent any specific examples, the opening sentence is essentially meaningless. Many, not all, of the larger cap stocks in the sector have very pricey valuations. Many other equipment stocks are certainly not showing high valuations - some are even valued at levels typical of a cycle trough, just like one would expect (I posted this yesterday in response to Morgan Stanley's downgrade siliconinvestor.com. 3. I've been through these cycles 3 times now and I've yet to observe an instance when ALL the factors Bear Stearns cites weren't true, the vast preponderance of evidence indicating investors should shun the sector completely. Equally invariably, stocks in the sector show substantial gains 6-9 months hence during such inflection points. 4. The observation that DRAM prices are 'amazingly firm' is a more tacit admission by BS that they really don't understand the current market environment (similar to #3 above). Their model is telling them 'X', valuations/DRAM pricing etc. is telling them 'Y', they are convinced their model is right so 'Y', the events in the 'real world', must be wrong. A specific note (beware: KLIC stuff, akin to previous comments): The report states, '...the move to new packaging methodologies such as flip chip and bump will likely re-accelerate in the current upturn driven by their lower cost, better performance and higher quality.' KLIC has one of the largest flip chip operations extant and the number of licensing pacts signed over the past year indicate widespread acceptance in the market. In fact, Amkor recently renewed and expanded its agreement. There's no question I'm biased towards KLIC; however, the absence of the stock in Bear Stearns' flip chip reference set is puzzling, to say the least. =============== In my opinion, this entire report was much more naive then compelling. ------------------- It's currently 6:30 AM in Chapel Hill, the sun breaking the crest of the horizon on to what appears to be a sparklingly clear morning. The visibility is excellent, a weather-alert of dense fog and a 10 foot maximum viewing distance notwithstanding. I guess the weatherman's model needs some fine tuning. The visibility of the model, not the empirical data, is unclear.