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

To: Will Lyons who wrote (10403)	7/4/2003 5:39:51 PM
From: Return to Sender	Respond to of 95546

Will, I think you are correct that you should be looking for those kinds of companies. Lets find more of them and discuss them here. Where I get concerned is that if the market is overvalued (and I think it is) then all stocks should correct. Even if they do not correct immediately (which I don't necessarily think they will) then it is difficult for growth trends to extend themselves higher for significant periods of time. Remember how hot the DVD Chip stocks like ESST, ZRAN and others were a year and a half ago? They were growing profits rapidly. Competition from other companies with excess capacity slowed profit growth. Competing new chip designs really whacked the heck out of ESST. It did not help ZRAN much either. So my point is that unless a company is so far out on the leading edge someone will catch up eventually. If there is a lot of profit being funneled into one sector of the market then new competitors will look to take some market share from the leaders. Even leading edge companies with real market strangle holds like CSCO or MSFT are subject to valuation issues so I think trading the range is the only way to truly profit until we get a business led economic recovery. That is until the market falls enough to be oversold on both a technical and sentiment basis. Then I will go long at least medium term. Right now I'll make short term trades cautiously long or short as my favorite indicators dictate while reading the technical changes in the charts. JMHO, RtS

To: Will Lyons who wrote (10403)	7/4/2003 8:43:40 PM
From: Cary Salsberg	Read Replies (1) \| Respond to of 95546

RE: " have noticed that in the last few months some techs have gone up much faster than others, which implies that all techs are not alike . My question is, then, should we be looking for companies that are likely to grow in the future..." Of course, we should be looking for growth. More importantly, we should be looking for profitable growth. Profitable growth requires companies to be able to defend their profit margins. This is where competitive advantage and its sustainability and barriers to entry become important. I find this to be a difficult exercise. I will admit that I watched (Yahoo "Prospect" portfolio, Bookmarked at SI) GNSS go from $7 to $70 and back to $7 without taking a position. It is necessary to determine which stock movements reflect current hype or a reaction to excessive moves to the downside. I have chosen 8 which I believe indirectly or, sometimes, directly will benefit from many or most of the areas you mention. My key for choosing these is my ability to understand and be confident in their competitive positions. By the way, forget the "dot coms and other high flyers of the past." I follow many tech companies with the hope of understanding and gaining confidence about their competitve positions and their potential for growth. I am satisfied with my current list, but I expect to be required to make changes over time and I expect change will be necessary to maintain excellent returns. So bring on your candidates!