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

To: The Ox who wrote (11408)	9/3/2003 3:16:25 PM
From: Return to Sender	Respond to of 95616

MIDDAY ACTION, Sept. 3 By Jody Osborne, Optionetics.com 9/3/2003 1:00:00 PM optionetics.com Another positive day for stocks has developed, but how far can this rally go? The Nasdaq ($COMPQ) continues its tirade into higher territory, with this tech laden index reaching a new 17-month high. However, the broader market is also moving higher, with the Dow ($INDU) and S&P 500 ($SPX) breaking to new 15-month highs. Traders are optimistic about the future and this has led to strong gains, but with stocks moving so quickly, valuation concerns have become an even larger worry. The economy has been a major reason for strength in stocks of late, with recent reports coming in better than expected. However, today’s news hasn’t been as strong, though Wednesday’s releases have been second tier. Consumer sentiment fell slightly last week as measured by the ABC News/Money Magazine Consumer Comfort Index. This index fell to -18 from -17, but still remains in a very narrow range. Chain store sales for the week ending August 30 rose just 0.1 percent, down from a 0.2 percent gain in the prior week. Construction spending rose 0.2 percent in July, but this was well below forecasts for a gain of 0.5 percent. Later today, traders will get the Fed Beige Book data to digest and this could have some market moving impact. Networking stocks are soaring today, with the AMEX Networking Index ($NWX) up nearly five percent. Networking giant Cisco Systems (CSCO) is seeing substantially higher prices after CEO John Chambers had positive things to say about the quarter. Mr. Chambers stated that August orders were better than expected and this was viewed positively by various analysts. Cisco shares are at another new 52-week high, rising nearly five percent, moving above the $20 level. Despite improving earnings projections, valuations are becoming rather lofty once again. For example, Cisco’s 2004 P/E ratio sits about 40, with Dell’s (DELL) P/E near 35. This means that if stocks continue to rise, projections are going to need to rise substantially to keep valuations in line. In fact, many analysts are calling for some profit taking in order to bring stocks back in line with earnings. September is normally a difficult time for stocks, so don’t be surprised if the month creates some selling, especially given that earnings warning season is nearly upon us. Jody Osborne Senior Staff Writer & Options Strategist Optionetics.com ~ Your Options Education Site

To: The Ox who wrote (11408)	9/3/2003 4:12:27 PM
From: BWAC	Read Replies (1) \| Respond to of 95616

'Needham' some buyers sounds like to me

To: The Ox who wrote (11408)	9/3/2003 5:07:35 PM
From: Return to Sender	Respond to of 95616

At this point there are no real laggards Michael. I mean there are no laggards in the group unless you look at those stocks which are so thinly traded that they have actually missed the current rally which may be flagging. How far have these stocks rallied? Well we have Don's tables to show us the average gain was 29% in the three weeks preceding this one. That's just three weeks! These stocks have moved up much, much, more than that since March: Message 19259860 Of course FSII was only up 8% during that three weeks but once again it does not trade many shares on a comparative basis. It was up for a nice percentage gain today. We can also look at the technical situation on the charts I have done of the group here: investorshub.com What I see so far is nothing more than some consolidation. So to me the question really is not what laggard should we buy on the pullback but rather it should be which stocks offer the most upside potential in the future? I'll review the charts tonight and give you my opinion which is likely to be worth less, or even worthless, to others but you might want to look at these ratings from the Bollinger site that Gottfried found us some time back: equitytrader.com RtS

To: The Ox who wrote (11408)	9/3/2003 5:23:44 PM
From: Donald Wennerstrom	Read Replies (3) \| Respond to of 95616

Michael, You ask a lot of good questions - let me make a couple of comments and then I will finish off with a table with 2 different sorts. First of all, in general, the stocks within the Group tend to move up and down together. The weak, usually smaller stocks, move the least amount, the next is the Generals in the Group that move well to the upside, but are limited because of their size, and the final group is the "medium size" stocks with good technology that really move, both on the upside and downside I might add. I put the following table together, portions of which I have posted several times before to illustrate the point. The first 3 columns in the table show the performance of the Group from the lows set on 10/8/98 and their respective high prices set in 2000. Two stocks at the top jump out at you, PHTN with a 3917 percent gain and LTXX with a 3736 percent gain. TER, AMAT, NVLS and KLAC, the 4 stocks in the Group that are part of the SOX were up 1307, 928, 858, and 791 percent respectively. Tremendous performance but pretty puny compared to PHTN and LTXX. Now lets go to the last 3 columns. Note that while the sort is not in the last column, since the low set on 10/9/02 and comparing to last Friday's close, PHTN and LTXX are clearly in 1st place again with gains of 1268 and 1065 percent respectively. Based on past performance during the 98 to 00 runup, and the fact that they are again in 1st place now during the most recent runup, I would think they may very well wind up at the top again at the end of this bubble. Also, by the way, we are well on our way to a new bubble top as the percentage gains since October show - still have a ways to go, but now the Group is gaining a full head of steam. Like Needham said this morning as reported by Briefing.com <With cycle-to-cycle growth, semiconductor equipment stocks could reasonably be expected to yield returns of 50%to 100% or more over the next 18 to 24 months.> Anyway, here is the table, first sorted by the 3rd column and then sorted by the last column. - 2000 - 10/08/98 HIGHEST 10/9/02 08/29/03 - CLOSE CLOSE PERCENT CLOSE CLOSE PERCENT SYMBOL PRICE PRICE CHANGE PRICE PRICE CHANGE PHTN 2.25 90.38 3917 2.38 32.57 1268 LTXX 1.31 50.25 3736 1.28 14.91 1065 ASYT 3.13 63.88 1941 3.10 14.00 352 LRCX 2.93 55.56 1796 3.30 25.61 675 MTSN 2.75 49.13 1687 2.75 6.00 118 CMOS 5.00 74.59 1392 5.03 11.49 128 TER* 7.82 110.00 1307 9.00 17.83 98 ASML 4.38 50.05 1043 4.54 15.77 247 BRKS 8.38 89.69 970 8.63 24.45 183 AMAT* 5.59 57.44 928 11.82 21.63 83 CYMI 6.50 65.25 904 8.00 45.77 472 NVLS* 7.30 69.94 858 7.69 39.96 420 HELX 7.88 75.38 857 8.63 18.36 113 SMTL 2.57 23.69 822 2.50 8.91 256 KLAC* 10.94 97.44 791 12.50 59.45 376 COHU 6.75 59.50 781 7.69 22.10 187 KLIC 5.19 43.00 729 5.78 11.74 103 WFR 3.63 23.75 554 3.50 12.98 271 EGLS 7.94 43.44 447 9.25 2.44 -74 FSII 4.25 23.13 444 4.63 4.40 -5 VECO 21.63 115.50 434 24.75 21.35 -14 ATMI 11.50 60.00 422 11.38 27.95 146 PLAB 9.50 45.13 375 11.00 24.28 121 DPMI 17.88 78.81 341 19.31 25.61 33 UTEK 13.56 23.50 73 15.38 29.32 91 TOTALS 180.56 1534.31 750 203.81 538.88 164 SOX-X 189.90 1332.73 602 200.80 456.06 127 COMPQX1419.12 5048.85 256 1492.49 1810.45 21 * STOCKS INCLUDED IN SOX INDEX - 2000 - 10/08/98 HIGHEST 10/9/02 8/29/03 - CLOSE CLOSE PERCENT CLOSE CLOSE PERCENT SYMBOL PRICE PRICE CHANGE PRICE PRICE CHANGE PHTN 2.25 90.38 3917 2.38 32.57 1268 LTXX 1.31 50.25 3736 1.28 14.91 1065 LRCX 2.93 55.56 1796 3.30 25.61 675 CYMI 6.50 65.25 904 8.00 45.77 472 NVLS* 7.30 69.94 858 7.69 39.96 420 KLAC* 10.94 97.44 791 12.50 59.45 376 ASYT 3.13 63.88 1941 3.10 14.00 352 WFR 3.63 23.75 554 3.50 12.98 271 SMTL 2.57 23.69 822 2.50 8.91 256 ASML 4.38 50.05 1043 4.54 15.77 247 COHU 6.75 59.50 781 7.69 22.10 187 BRKS 8.38 89.69 970 8.63 24.45 183 ATMI 11.50 60.00 422 11.38 27.95 146 CMOS 5.00 74.59 1392 5.03 11.49 128 PLAB 9.50 45.13 375 11.00 24.28 121 MTSN 2.75 49.13 1687 2.75 6.00 118 HELX 7.88 75.38 857 8.63 18.36 113 KLIC 5.19 43.00 729 5.78 11.74 103 TER* 7.82 110.00 1307 9.00 17.83 98 UTEK 13.56 23.50 73 15.38 29.32 91 AMAT* 5.59 57.44 928 11.82 21.63 83 DPMI 17.88 78.81 341 19.31 25.61 33 FSII 4.25 23.13 444 4.63 4.40 -5 VECO 21.63 115.50 434 24.75 21.35 -14 EGLS 7.94 43.44 447 9.25 2.44 -74 TOTALS 180.56 1538.43 752 203.81 538.88 164 SOX-X 189.90 1332.73 602 200.80 456.06 127 COMPQX1419.12 5048.85 256 1492.49 1810.45 21 * STOCKS INCLUDED IN SOX INDEX

To: The Ox who wrote (11408)	9/3/2003 7:20:30 PM
From: Cary Salsberg	Read Replies (1) \| Respond to of 95616

RE: "For the sake of discussion..." 1. We haven't had a real upcycle since 1995. The move that started in November 1996 was abruptly terminated by the "Asian Flu" and the move that started in October 1998 was distorted and shortened by the bubble. 2. I believe that we are moving through the bubble aftermath and industry expansion has been and will remain cautious until end markets return to more robust growth. I believe that 2005, 2006, 2007 or 2006, 2007, 2008 will look like "normal" ~3 year up cycles. 3. I believe that at the top, the greatest appreciation from here will be made by the top tier. I use "here" because it removes the volatility about the bottom. I choose the top tier because I believe they have the greatest ability to increase market share and penetrate new markets while maintaining high margins.

To: The Ox who wrote (11408)	9/4/2003 1:16:14 PM
From: The Ox	Read Replies (1) \| Respond to of 95616

Thanks for the responses to my question. I believe that the smaller caps will have greater appreciation %s because they are inherently more risky and therefore will probably "pay off" more if the expected recovery floats all boats. EGLS and GGNS have started to soar and FSII is picking up a bit, too. These are current examples of why I think the smaller plays should be considered at this stage. UPDATE - National Semiconductor profit rises in first qtr Thursday September 4, 1:07 pm ET (Adds outlook, analyst estimates, background, stock price) SAN FRANCISCO, Sept 4 (Reuters) - Chipmaker National Semiconductor Corp. (NYSE:NSM - News) said on Thursday its quarterly net profit jumped while revenue rose slightly from a year earlier, after cutting costs and gaining market share. The company, whose shares rose almost 6 percent, said net profit in the fiscal first quarter, which ended Aug. 24, was $29.7 million, or 15 cents a share, compared with $1.3 million, or 1 cent a share, a year earlier. Revenue rose to $424.8 million from $420.6 million a year earlier. The Santa Clara, California, chipmaker had said in June it expected first-quarter revenue to be flat to down 4 percent from fourth-quarter sales of $425.3 million. Analysts, on average, expected the company to post earnings per share of 12 cents on revenue of $417.8 million, according to Reuters Research, a unit of Reuters Group Plc. For the current quarter, National Semiconductor said it expects to see revenue rise 4 percent to 7 percent from the first quarter, implying a range of $441.8 million to $454.5 million. Excluding charges related to severance, asset impairments and accounting changes, the company would have posted profit of $34.7 million, or 18 cents a share, it said. The company, which competes again Texas Instruments Inc. (NYSE:TXN - News) and STMicroelectronics (Paris:STM.PA - News), launched a reorganization this year that included getting rid of businesses that were not key to its core competency. National Semiconductor is focusing on selling analog chips that convert voice and visuals into digital signals in cell phones, digital cameras and computer displays. The chip industry is showing signs of rebounding after a two-year downturn, the worst in its history, following an economic slump that halted corporate spending on information technology. Shares of National Semiconductor were trading at $29.90, up 3.75 percent, on the New York Stock Exchange (News - Websites).