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

To: Gottfried who wrote (9796)	5/13/2003 11:13:01 PM
From: Big Bucks	Read Replies (1) \| Respond to of 95617

Not sure if this was posted previously...BB siliconstrategies.com Opposing viewpoints persist on IC-equipment recovery By Bill Ong Semiconductor Business News (05/07/03 05:00 p.m. EST) The following article was provided by Bill Ong, a senior research analyst at American Technology Research Inc. in San Francisco. American Technology Research is an independent research house based in Old Greenwich, Conn. Analysts and investors remain sharply divided on both the timing and the rate of the industry recovery. The more bearish sell-side analysts do not see a semiconductor equipment industry recovery until late 2004, given the weak outlook from lithography tool suppliers. The more bullish sell-side analysts view a recovery is at hand either in late 2003 or early 2004, given the bottoming of orders most believe the industry is currently experiencing. One bullish market research firm, Strategic Marketing Associates (SMA), recently indicated that about 36 new fab projects could likely get underway by Q2 2004. SMA believes DRAM makers and foundries will be the driving factors for higher spending next year. We believe that most bulls and bears would agree that semi equipment industry orders are currently in a bottoming process. Opinions start to diverge as to whether the current near strength (higher utilization rates) is sustainable. While the bears cite inventory builds and lack of demand, we have conveyed otherwise by citing current inventory levels from the EMS providers are below the early 1998 levels and fab supply is more closely aligned to current demand. An industry recovery is hinged on the macroeconomic environment improving, thereby allowing demand for semiconductors to improve. We believe the supply side of the equation--through facilities consolidation and headcount reductions from EMS providers to chip makers to chip equipment suppliers--have laid the foundation for upward movement when demand starts to modestly improve. Chip makers spend cautiously; first for the immediate needs, then on intermediate needs, followed by long-range needs. Nonetheless, the near term outlook from semi materials providers have been good. ATMI Inc. has seen utilization rates improving, prompting increased demand for process chemicals to foundries, DRAM and logic chipmakers. Wafer and photomask demand have also improved with stabilized pricing as cited by MEMC Electronic Materials Inc. and DuPont Photomask Inc. (DPI), respectively. We believe Photronics Inc. is in a better position than DPI to benefit the near term recovery given Photronics' more aggressive cost cutting measures. Photronics has pulled in their profitability to the July quarter while DPI's slower cost control actions has delayed their breakeven point by a quarter. The intermediate needs are firming with continued spending cited by flat sequential order outlook in the June quarter from Lam Research Corp. and KLA-Tencor Inc. We expect Applied Materials Inc. to report modestly up sequential orders for their April quarter and to provide at least a flattish order outlook for the July quarter. The long-range spending will be dependent on a definitively firmer macro-environment in order for chipmakers to step up to more sizable investments on $12-to-$15 million steppers and subsequently the laser components. As a result, it is natural to expect ASML Holding NV and Cymer Inc. to have a more cloudy outlook. We remain encouraged by the earnings reported by most of the equipment suppliers and believe as we enter into the summer seasonal lull, investors will be afforded the opportunity to build positions on well-managed semi equipment providers for the expected sustainable order recovery in late 2003.

To: Gottfried who wrote (9796)	5/14/2003 8:59:00 AM
From: Proud_Infidel	Read Replies (2) \| Respond to of 95617

I had no idea the Japanese decimated the SCE group in the 80's....isn't that precisely the period when the American cos(Lam, AMAT) were growing in strength? What am I missing here other than someone stating something entirely inaccurate? Brian **************************************** Give Analysts a Few Days on Applied Materials Wednesday May 14, 8:50 am ET By James J. Cramer, How revolting is tech research? Let's take Applied Materials (NasdaqNM:AMAT - News). It was an awful quarter. You can't hide that. Just awful. Every metric was terrible. This semiconductor equipment industry is in some sort of downturn like we have never seen before, except maybe when the Japanese decided to take this industry over in the 1980s and decimated the American players.** It is a relentless decline.