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

To: Return to Sender who wrote (15737)	6/15/2004 1:59:03 PM
From: The Ox	Read Replies (2) \| Respond to of 95564

Hi RtS, Thanks for trying but where we differ is that I'm looking at the semi market separately from the overall market. For example, I think anyone buying TSM here at the current price will be rewarded down the road and is a no-brainer for a patient individual. The semi's are out of favor and they may continue to be for a long time. Regardless of this fact, many of the companies in this sector are "good" buys at this level. That is not to say they won't go down but the risk/reward balance has tipped in the favor of buying (or holding) not in selling or being on the sidelines. As always, timing is important and one needs to be cautious when entering new positions in this sector. Don's tables are a great help in gauging where the momentum is and where the valuations are attractive enough to justify new positions. As far as an overall market bottom, no of course we aren't at a market bottom but that doesn't mean that we won't head higher. Look at LEH's earnings as one example of how well companies are doing at this stage in the recovery. Other examples are TSG, or PG. The US has been in recovery mode for quite a while now but the financial press continues to print extremely negative views on a daily basis. Everyone is looking for clouds and clouds only. No one is seeing any of blue skies that are right next to the clouds. I'm not blind and I'm not hard headed. I just think that those of you who keep pounding the table about how poorly our economy is doing are way off base. There are issues and there are problems but there are solutions and progress being made which get little to no press. It's still a very tough business environment for most but, for the most part, companies have become more efficient and have been cautious (almost to a fault). These cautions should help the recovery, not hurt it, by extending the cycle and limiting the growth rates from being too fast. Most of the analysts who cover the semi industry think we've come too far, too fast because they are looking at the year over year growth rates. They have failed to recognize that the first half of last year was about the worst period ever for this industry so, of course, the growth rates look unbelievable and unsustainable. We all know this. No one is expecting 40% improvement next year. DUH! However, double digit growth is not unreasonable from the current spending pattern. Japan saw a major reduction in spending in April compared to March. The cautious approach to spending is still in affect in this industry, which is why I dispute the hypothesis that 2005 will show negative growth vs 2004. So let me be clear, RtS. Your points about the overall market are appropriate. However, in this sector, the potential for nice gains are there for those who aren't afraid to go against the prevailing negative sentiment. jmo

To: Return to Sender who wrote (15737)	6/15/2004 2:15:16 PM
From: Kirk ©	Respond to of 95564

Sorry I missed it... I just reply to the post I saw. "The CPC is objective but has limited value imho. The Volatility Indices are objective and much more important. The Newsletter Writers Survey is objective and a terrific contrary indicator." I follow all of those. Newsletter writers are bearish according to what Mark Hulbert writes.... I think they lie to doctor the survey... look at what they do, not what they say on free surveys. I bet VIX goes to lows you have not seen for many years. Your are looking far too short term on it. Also, I think all that really matters for it are changes, not absolute value. CPC is a measure of what people are doing, not what they say. The big sentiment indicators are not visible to most. Watch the msg boards and it is the expert shorts who think they are the smart ones. They write like those who were overly bullish in 2000 rather than taking profits. Cramer and many of Rukeyser's guests are still talking about dividend stocks. This is bearish as they make money investing in stocks and they are still defensive.... they want dollars to invest for a fee but they are not putting them to work in tech. Watch for Cramer and Lis Ann Sonders to start recommending stocks only because they are going up and you have to own them... then talk to me about a top. -snort. Kirk

To: Return to Sender who wrote (15737)	6/15/2004 2:17:12 PM
From: Proud_Infidel	Read Replies (2) \| Respond to of 95564

The CPC is objective but has limited value imho. Why does this have "limited" value?

To: Return to Sender who wrote (15737)	6/17/2004 12:39:06 AM
From: robert b furman	Read Replies (1) \| Respond to of 95564

Hi RtS, I have learned to value your comservative and disciplined posts. As mine are historically optimistic -yours are often very cautious. When studying 98 and SCE stocks,as you point out, the negative market sentiment in October was much more negative than now. However the turn that occurred in early October of 98 was very fast and it turned on a rebound of order backlog.Many companies still reported sick earnings on the Q4 of 98. None the less the backlogs grew,Q4 has throw in the sink and don't pay taxes,and 99 rocked up and never looked back. We all know 99-00 was an overblown distribution top and much excess capacity has gratefully been put to use. I believe the excess capacity has varied by product and production line.This has resulted in a less robust reversal and a less painfull bottom. The bottom has been less painfull because I think we saw a faile rally bottom in July and October of 02. As I recall the Rally that topped in 97 failed all through 98 until the bottom was reached in 98. I think long term that the major distribution top experinced in 00 will give us longer recoveries (much like the triple bottoms of 01 and 02) AND longer consolidations - much like we're seeing now. No fast reversals -just because backorders have popped up. Most ebery one is once bit and twice shy and the rest of us just want the good ole GOGO days back one more time so we can sell at the top. I think we need to lear to invest and not speculate. We must relearn long term investing. We must place a premium on PATIENCE. Most final tops occur after sevearl rallies correct and we see 4-5 bases form and violate up to the top. I think what we have now is just the first rally that is holding and giving us a correction instead of NEWS DARN LOWS. This is significant. The longer it takes the higher the final blow off top will be. I can be aptient knowing that. I know that longer consolidations result in higher tops. We are simply at the first sideways consolidation after major blowoff top in 00. The longer it goes the better it will be. Oh yes - always expect a final shakeout - it will be your last great perfect buy area. The next great "add to" spot will be a breakout to new highs - always much riskier. I don't think we should expect the same levels of volatility that we saw back just before the great blowoff top like we saw in 98. I expect we should see boring sideways consolidation.Investors like to see this - speculators can't stand it. I think this market needs more investors and patience. I think it looks good and I hope it slos down and builds strength. If you own any stocks - go to the monthly charts and see if you favorite doesn't dip before it has a nice move to a new higher level of consolidation. If it does dip before a rise - how is your attitude? If you like it at 19 will you love it at 17?? Will you be a buyer on a dip or will you lose your position?? Earnings are getting stronger,faster,than I've ever seen before. GDP is rocketing - productivity is shattering past levels of improvement. Are you/we investing or speculating. Now is a time for careful accumulation on dips. I don't think we should expect to see the volatility that was associated at the top of a major market cycle (99-00) I think we should embrace longer terms and dips that test / violate monthly support levels. Over time - we'll be very rich - If we're just patient. As always I greatly value your sincere and well thoguht out posts. Keep checking me - I need it.<smile> Bob