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

To: wasWoody_Nickels who wrote (5519)	7/24/2006 12:04:40 AM
From: Kirk ©	Read Replies (1) \| Respond to of 5867

Things really ARE different this time. Lam's new model shouldn't require charges for layoffs unless there is a depression instead of a recession. I think the mistake the analysts are making is continuing to classify it as a deep cyclical which loses money in the down turn. From what I can tell, LRCX could easily make $3 a year in this next soft spot then resume earnings growth when orders for the growth in 2008 return. About the only improvements I see left for LRCX to make are -Eliminate or reduce stock option dilution -Pay a hefty dividend once they prove they can remain profitable in downturns. -buy back more shares than needed to cover option dilution. They have a TON of cash and keep generating it. I'd HATE to see them try to buy a major company, such as NVLS, which would dilute their model and delay what I've been hoping to see out of them... I think if they eliminate the options dilution then they could pay a 4% dividend which would really be something... Kirk

To: wasWoody_Nickels who wrote (5519)	7/24/2006 12:40:10 AM
From: etchmeister	Read Replies (2) \| Respond to of 5867

Now if we can get the 'options as compensation' monster under control, life should be much better. But you still need to compensate - you can't expect them working for free. Are you willing to compensate in case they work very hard but fail for whatever reason (perhaps a reason out of their control?) Employees taking option based compensation is a risk for employees because they can work their butt off without even coming close seeing a nickel in overtime. Money is not really a motivator - it's by product for putting in long hours But the analysts were very slow to recognize Lam's new 'lean and mean' production abilities, as shown by Lam's P/E lagging for many qtrs near 10, while other SCEs were >20. I recall several years ago Bagley et al made a presentation on how the new business model would work - specifically what would happen to margins when bookings/shipments increase. From what i recall: the analysts did nort believe it and their comment was "how much can Lam squeeze teir suppliers to increase Lam profits" - well you don't squeeze your suppliers to death because in long term it will kill you. There is a great deal of lack of common sense and how to run a business in the real world among the financial community that "follows" SCE - unfortunately we are stuck with these individuals who probably never have seen a clean room from the inside - well; that's just like the cookie crumbles I suppose n