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Technology Stocks : Lam Research (LRCX, NASDAQ): To the Insiders -- Ignore unavailable to you. Want to Upgrade?

To: Cary Salsberg who wrote (5246)	4/1/2005 11:39:27 AM
From: Proud_Infidel	Read Replies (1) \| Respond to of 5867

Picks In Chip Equipment As Inventory Worries Fade 04.01.05, 11:27 AM ET In a quarterly review of chip equipment stocks, Credit Suisse First Boston highlighted four semiconductor companies with attractive risk/reward scenarios as investor concerns with chip inventories begin to fade. "We established upside prices for our stocks based on peak multiples of next cycle earnings, EBITDA [earnings before interest, taxes, depreciation, amortization], and free cash flow," it said. "We assume fundamentally that the next peak year (regardless of when that peak occurs) looks like the calendar 2004 cycle for revenue and earnings." The research firm said that based on its "upside/downside analysis" stocks looking "relatively cheap" are Novellus Systems (nasdaq: NVLS - news - people ), Lam Research (nasdaq: LRCX - news - people ), Amkor Technology (nasdaq: AMKR - news - people ) and Varian Semiconductor (nasdaq: VSEA - news - people ). The research firm highlighted Amkor as an "early cycle play" and said Novellus is well-positioned to improve its operating margins. "Our analysis of upside potential versus downside risk for Amkor suggests an upside price of $5 to $9 versus a downside price of $2. On a pure trading basis we believe a favorable risk reward here is somewhat valid--we think we are in the earlier innings of a cyclical unit recovery (albeit modest) and Amkor is an early cycle play," said CSFB. "Our peak price of $40 to $50 is consistent with our recent upgrade of Novellus, where we argued that the company has added $2.0 billion to $2.5 billion in new addressable markets, well positioned to leverage DRAM copper transition and has the best opportunity to improve operating margins relative to peers." CSFB noted that the following stocks look relatively expensive: Cymer (nasdaq: CYMI - news - people ), Credence Systems (nasdaq: CMOS - news - people ), Brooks Automation (nasdaq: BRKS - news - people ) and Teradyne (nyse: TER - news - people ).