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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (37768)	4/24/2003 5:38:26 PM
From: orkrious	Respond to of 57110

16:20 ET FLEX Flextronics misses by a penny, guides below consensus Here's what Herb Greenberg said: Weakness at Flextronics doesn't bode well. From one of my great tech hedge fund sources, who has shared plenty with readers in the past: "So much for the huge snapback in demand. It will be interesting to understand the revenue weakness at Flextronics and the guidedown as well. FLEX is about as well run a contract manufacturer as there is and as broadbased as well. However, they do have large exposure to handsets, so I also suspect that is a source of weakness as well. Importantly from a component perspective, inventory turns dropped 20% sequentially. Add them to the list of inventory builders this quarter." and this China is suddenly looking like a wireless meltdown point. For what it's worth: This could be a critical piece of data that nobody is talking about -- yet. It's what JP Morgan analyst Johnny Chan said to his firm's clients: "China handset inventory remains high exiting 1Q03. Even worse, SARS has started to impact the already slowing handset sales in China over the past four days, with sell-through in major cities down 40% (week over week). This will only exacerbate the handset inventory situation further." See those numbers? Down 40% week over week, with a big impact seen in the past FOUR days! China was THE bright light in the world of handset sales. With SARS on the spread, it would seem consumers don't want to go handling handets in public, which isn't good for a host of handset-tied companies, including Silicon Labs (SLAB:Nasdaq), Texas Instruments (TXN:NYSE), Qualcomm (QCOM:Nasdaq) and Nokia (NOK:NYSE).