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

To: Jeffrey D who wrote (62236)	3/21/2002 8:09:20 PM
From: Donald Wennerstrom	Read Replies (1) \| Respond to of 70976

Here is another take on the AMAT action today from Market Watch.com By Daniel Sorid NEW YORK, March 21 (Reuters) - Applied Materials Inc. (AMAT) , the world's largest maker of microchip manufacturing equipment, on Thursday said it would split its stock, news that came as the company said the semiconductor industry was finally recovering. Stock splits, while neutral to the value of an investor's holdings, can have psychological importance for investors who consider splits a sign of management confidence in the long-term health of the company. Stock splits by technology companies had slowed considerably since the boom days of the late 1990s and 2000. Following news of the split, Applied Materials shares rose almost 2 percent in after-hours trading to $52.93. Applied Materials shares are up more than 90 percent from September lows, but still well off a high of $115 two years ago, during the high-technology boom. At its annual meeting with Wall Street analysts on Thursday, Applied Materials executives spoke optimistically about the chip industry, which had been battered over the last year by an ailing economy and weaker demand for computers and other electronics. "We believe the recovery is in progress," Executive Vice President David Wang said. The semiconductor industry appears to be coming off its worst downturn on record. The chip equipment industry, whose livelihood depends on the capital spending plans of chip makers, saw sales drop 41 percent last year, to $28.1 billion. Several chip equipment companies have already forecast stronger orders, and Applied Materials on Thursday indicated it still believes a recovery is in process. Wang said so-called microchip foundries, which manufacture chips designed by other companies, are increasingly busy, and should produce at 80 percent of their capacity by the end of the year, from only around 50 percent today. He also said chip-making equipment revenue should accelerate in the second half of the year. For the year overall, however, he said industry revenue could drop 18 percent. Applied Materials has tied its future increasingly to China, whose growing economy has lured the world's largest chip makers. China now produces only about one of every four microchips it uses, but chip production in the country is expected to skyrocket. Applied Materials made its first contact with China in the early 1980s when Jiang Zemin, who was China's minister of electronics at the time before becoming China's current president, made a visit to the company's offices in California. The company now has several sales offices around China. In February, Applied Materials predicted orders in the second quarter would rise 10 percent to 15 percent from the first quarter, with revenue at $1 billion or slightly higher. It also said then it expects to reach profitability if that revenue target is met. New shares from the split are expected to be distributed about April 16 to shareholders of record April 1.