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Technology Stocks : Novellus -- Ignore unavailable to you. Want to Upgrade?

To: Cary Salsberg who wrote (3680)	2/15/2008 12:45:05 PM
From: brushwud	Respond to of 3813

if industry cycles are very muted, companies are cash flow positive through the cycle, stock prices don't reflect changed conditions, then the use of cash to SIGNIFICANTLY reduce share count benefits shareholders. EPS increases and dividends may be raised more easily because they are paid on fewer shares. You're expressing a belief for which there is no evidence. Share repurchases reduce both income (the interest earned on the cash used for the repurchase) and the number of shares, so they represent a partial liquidation of the company. That's the opposite of an IPO: IPOs are bullish, repurchases are bearish. A share repurchase at the bottom of the market would be a good thing, but if the CFO is able to time the stock market that well he should be working for an investment bank. Almost all of the share repurchases we see are secular; they take place throughout the year at whatever the price happens to be. Both Intel and Novellus actually bought back shares in 2000 when the interest they were getting on cash was > the reciprocal of their P/E ratio, which decreased EPS immediately. Usually repurchases take place at lower P/Es, but are still an indication of slowing growth. Feel free to nominate a stock doing share repurchases which is beating the S&P 500.

To: Cary Salsberg who wrote (3680)	4/11/2008 3:09:04 PM
From: etchmeister	Read Replies (1) \| Respond to of 3813

NO surprise here IMHO - in particular in commodity bizz Utilization rates dropping at 8-inch fabs Printer friendly Related stories Comments Email to a friend Latest news Hans Wu, Taipei; Joseph Tsai, DIGITIMES [Friday 11 April 2008] Due to declining orders, utilization rates at the 8-inch fabs of DRAM makers including ProMOS Technologies, Powerchip Semiconductor Corporation (PSC) and Nanya Technology are seeing drops which are expected to have a deep impact on current operations, according to industry sources. The 8-inch fabs are mostly unable produce standard DRAM in 2008, forcing makers to manufacture specialty DRAM or seek more clients in order to fill the gap in their capacity. With Nanya upgrading one of its 8-inch fabs, the company has demanded its clients transfer their orders to its other 8-inch fab. However, since these clients need time to evaluate the fab, most have decided to cancel their orders, causing Nanya's orders to drop from 20,000 units to only 10,000 units. The limited process technology at PSC's 8-inch fab means the company will not be able to switch its capacity to produce standard DRAM. Meanwhile, ProMOS has installed 8-inch equipment at its subsidiary in Chongqing, China, but most of its clients have been unwilling to move their orders to the new China fab, while other clients, suspecting the company will soon move its whole production line to China, are therefore unwilling to place orders at the company's 8-inch fab in Taiwan.