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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Big Bucks who wrote (14235)	4/12/2005 10:19:37 PM
From: BWAC	Read Replies (1) \| Respond to of 25522

<I'm sorry, call me skeptical, though I'd love to be proved wrong.> Ok here is the $60 scenario. AMAT hits one single $3 Billion quarter in the next 3 years while trading at $30. Bank of India clownanalyst issues a Strong Buy and predicts $16 Billion revenues over the next year pushing the price to $45 in less than 7 trading days. Crammer piles in at $45 and touts it on whatever is left of CNBS. Goldman issues a $105 price target. Price moves to $60 as the next quarter earnings near. Gap to 70 in premarkIt, then begins the next slide all the way back to $10. Seems unbelievable. But just watch.

To: Big Bucks who wrote (14235)	4/12/2005 10:41:32 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

BB, Your assumptions are tied to the past. How much equipment will be sold when the IC market is $350B plus per year? At a capex rate of 20%(historical average), that is $70 Billion dollars per year for the industry, with AMAT gobbling up much of that. When the tide turns, I think you will be very surprised at the potential for AMAT and the rest of the group. Brian

To: Big Bucks who wrote (14235)	4/13/2005 2:53:40 AM
From: Cary Salsberg	Respond to of 25522

RE: "That is a lot of equipment to sell and support in 1 year..." In 2004, after a severe decline in sales from the 2000 peak and several rounds of cost cutting, including layoffs, AMAT doubled revenue to over $8B. Estimates for 2005 and 2006 call for ~$7+B and ~$8+B. I do not doubt that AMAT will be able to ship $16B in revenues with excellent profit margins some time in the next 5 years. The real questions are the growth rate for the semi industry and the ratio of semi-equip revenue to semi revenue. I expect that most experts have underestimated semi industry growth rates and the revenue ratio and will continue to do so for a while longer. I believe that the lack of price appreciation is a function of the falling PEs that go along with falling expected growth rates. Industry missteps like the inventory buildup exacerbate the situation short term.