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

To: Return to Sender who wrote (8281)	1/28/2003 10:22:33 PM
From: Return to Sender	Respond to of 95730

Semiconductor Equipment . . . Dover said its fourth- quarter net income fell to 7 cents a share from 12 cents a year earlier. FEI had fourth-quarter profit, excluding certain items, of 8 cents a share. On that basis it was expected to earn 4 cents. Taiwan Semi 4th quarter results were slightly disappointing - more cautious news for the semi industry. The company expects industry growth of only 8% this year (in-line with our 10%, but below general expectations). They expect to grow faster than the industry due to continued outsourcing. The firm reported NT$2.55 billion, -43% Year/Year versus ¡V19% consensus). EPS was NT$0.13, below expectations. Sales increased 3% Quarter/Quarter in 4th quarter to NT$41.2 billion (they already reported Dec. revenue so that was already known). ASPs were about flat (down slightly in $, up 2% in NT$ due to exchange rate). Wafer shipments increased only 1% Quarter/Quarter. The strongest segment was computers, which increased from 36% of sales in 3rd quarter to 39% in 4th quarter. 0.13 micron accounted for 8% of sales, up from 5% in 3rd quarter. Utilization rate was only 61%, as expected, down from 79% in 3rd quarter. Gross margin dropped from 32% to 26% due to lower utilization. In 1st quarter, TSMC expects shipments will decline in the low single digits Quarter/Quarter. ASPs will drop 7% Quarter/Quarter, more than expected, as the percentage of advanced process shipments will remain about the same and pricing at any given technology will decline. Co believes the percentage of advanced wafers will increase in 2nd quarter. ƒnUtilization is expected to remain about 60% in 1st quarter. Communications is expected to show a slight improvement in 1st quarter. The company expects sales to begin to recover in 2nd quarter. Reduced capex to $1 billion-$1.5 billion, as expected, vs. $1.65 billion in 2002. Semiconductors . . . Intersil is one of few companies in the semiconductor industry positioned for upside surprises later in the year. The company remains well positioned to benefit from an improving competitive environment in WLAN, where the industry is moving to higher data rate 802.11g products, which are currently ramping. The company is also well positioned for rapid adoption of recordable DVD products. The potential for inventory correction in power management, where products are on allocation. Across several of its product lines (WLAN and power management), the company is managing a volatile supply chain which is prone to gyrations, driven by strong demand for its products. However, much of these concerns are discounted in the stock. The company reports tomorrow after market. Expect in line results ($180M, EPS $0.18) and guidance for the March Quarter to be seasonally down. Do not anticipate any surprises during the conference call. The stock is undervalued and close to a near-term bottom and would be buyers on additional weakness. Price target is $24 based on 30x our 2003 EPS estimate. 2020insight.com