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Strategies & Market Trends : Trade/Invest with Options Jerry a Point & Figure Chartist -- Ignore unavailable to you. Want to Upgrade?

To: Jerry Olson who wrote (5389)	3/20/2002 8:27:00 AM
From: SusieQ1065	Read Replies (1) \| Respond to of 5893

Jerry....here's an excerpt from OI newsletter last night...they're pretty bullish on Semi Equipment makers.. As evidence of the strengthening economy the semiconductor book to bill numbers announced after the bell showed a +10% growth from January to February. The book-to-bill ratio rose from .81 to .87 which means $87 of new orders were received for every $100 of revenue recognized. This "recognized" label was changed from "orders shipped" after problems arose with channel stuffing and orders refused during the recession. To recognize revenue the customer must accept the order and take delivery. The brightest outlook is in the equipment makers stocks. Chip equipment makers sold $28 billion of equipment in 2001. With newer, smaller, thinner, faster and cheaper chips the continuing trend the equipment makers are due to sell an entirely new wave of equipment. Intel just announced a move to the .09 micron process for the next generation of processors which make much of the old equipment obsolete. The industry is reporting a dwindling inventory of chips and a sharp upturn in demand from China. Some analysts estimate that orders for chip equipment could rise by +17% this year which would equate to nearly $33 billion in orders. This should be very bullish to the semiconductor equipment stocks but may not impact the chipmakers themselves. Ordering new equipment may be bullish but if orders for the chips themselves do not increase then earnings will continue to suffer.