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

To: Donald Wennerstrom who wrote (10834)	8/5/2003 1:21:54 PM
From: Return to Sender	Read Replies (1) \| Respond to of 95881

Taiwan's Compal posts profit rise, outlook upbeat Tuesday August 5, 9:24 am ET By Baker Li biz.yahoo.com TAIPEI, Aug 5 (Reuters) - Taiwan's Compal (Taiwan:2324.TW - News), the world's second-largest contract maker of notebook PCs, reported a better-than-expected 36 percent rise in quarterly net profit on Tuesday as global demand recovered from last year's slump. ADVERTISEMENT Compal Electronics Inc, which trails compatriot Quanta Computer Inc (Taiwan:2382.TW - News) in making portable PCs for other companies' brands, sounded an upbeat note for the third quarter, a key period for Taiwan's tech firms as they push out products for the Christmas season. Ray Chen, Compal's president, also noted growing demand for laptops with Intel Corp's (NasdaqNM:INTC - News) new Centrino processing chip, which offers wireless Internet access. "Besides the peak season, the launch of Centrino makes us believe that there should be strong growth in the laptop market down the road," Ray Chen, the company's president, told a briefing for institutional investors. PC shipments in Asia, excluding Japan, rose a modest two percent in the second quarter from the first, weighed down by the impact of SARS on retail markets in the region, although comparisons with a year earlier showed a 12 percent rise, according to market researcher IDC. Compal's net profit rose to T$2.61 billion (US$76 million) in the April-June period, from T$1.92 billion a year earlier. The figure also beat the T$2.3 billion-T$2.5 billion estimated by market analysts and the T$2.41 billion Compal earned in the first quarter. The results came after the close of share trade on Tuesday when Compal fell 2.91 percent at T$50.00, while the main TAIEX (Taiwan:^TWII - News) market index dropped 2.19 percent. REPLACEMENT EFFECT The second half of the year is typically a peak season for manufacturing in Taiwan as clients in Europe, the United States and Japan increase orders ahead of the Christmas shopping binge. Compal's customer list includes most of the leading branded notebook PC vendors, including Hewlett-Packard Co (NYSE:HPQ - News) and Acer Inc (Taiwan:2353.TW - News), Taiwan's top personal computer company. Compal said global notebook PC shipments will probably reach 37 million units this year and the company aimed to produce about 14 percent of that, compared with Quanta's 22 percent. Over the next several years, notebook PC shipment growth is expected to outpace desktops, spurred by rising demand for wireless Internet access, analysts said. "We've seen the replacement effect, which will be more significant next year," said Angela Hsiang, an analyst who tracks the computer industry for KGI Securities. Taiwan, which makes more than half of the world's notebook computers, churned out about 18 million of the portable machines in 2002, up from 14 million a year earlier, according to the Market Intelligence Center (MIC), a local industry think tank. Shipments of desktop computers in Taiwan reached 25 million last year, flat from a year earlier, MIC said. ($=T$34.4) Don, perhaps I am just frustrated that I am not long at the offered prices last October or March but I do hold some serious concerns about the ability for these stocks to trade higher before October. I know I could be wrong but a 30% decline from the recent highs would go a long way towards a more justifiable long entry point in my humble opinion for most stocks in the group. RtS