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To: Sig who wrote (7726)	6/6/2002 12:48:05 PM
From: stockman_scott	Respond to of 13815

Growth is not enough - growth in excess of expectations is needed Semiconductor Tea Leaves : The semiconductor index is down 2.8% in response to a Merrill Lynch downgrade, but investors could have made the same determination that Merrill made by taking a quick look at yesterday's SIA (Semiconductor Industry Association) data. The SIA released its long-term industry forecasts yesterday afternoon. The headline numbers looked relatively impressive: growth of 23.2% in 2003 and 20.9% in 2004. In its last outlook from Nov 7 2001, the SIA saw 21% growth in both 2003 and 2004, so the new numbers look relatively friendly. But a closer look reveals a small problem with this optimistic view. In November, the SIA expected 2004 sales of $218 bln. Yesterday, they put 2004 sales at $213 bln. And don't bank on that lost ground being made up in 2005, for which they are forecasting just 0.9% growth to $215 bln. All that has happened in the last seven months is that the 2002 forecast has come down a bit, thus boosting the 2003 growth rate but reducing the level of sales in both 2003 and 2004. The message to take away is plain: the semi sector is recovering, but the recovery is not living up to expectations. Given already rich valuations in the sector which discount a healthy recovery, any shortfall in the actual recovery will tend to depress the stocks. That was essentially the message behind Merrill's downgrades today, and it's a message worth taking seriously. We are long past the point when semi stocks can do better simply because the sector's sales have turned the corner and are now heading higher. Growth is not enough - growth in excess of expectations is needed, and yesterday's SIA data provide no evidence of that. - Greg Jones, Briefing.com

To: Sig who wrote (7726)	6/6/2002 1:55:00 PM
From: stockman_scott	Respond to of 13815

EMC: Dell to Make, Sell New Low-Cost Storage Device Thu Jun 6, 1:08 PM ET BOSTON (Reuters) - EMC Corp. said on Thursday it is entering the low-end of the data-storage industry by way of a deal with Dell Computer Corp., which agreed to make and sell a new storage device for the world's No. 1 data-storage firm. "We have a handshake," EMC Chief Executive Joe Tucci told analysts at a meeting in New York City, describing the agreement with Dell. Dell has become increasingly important to EMC's strategy to lower costs and penetrate new markets as some of EMC's rivals have taken some of its revenue in the high end market. Tucci said details still need to be worked out, but said Dell , the world's second largest PC maker, can make the new device anywhere it sees fit. No time line has been given for the launch of the product. EMC also will look to its other partners to sell the device. EMC , whose flagship storage device can cost more than $1 million, does not have a product in the low-end market. The company's bread and butter market has been selling refrigerator-sized machines to the world's largest corporations.