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

To: Jacob Snyder who wrote (43758)	3/16/2009 7:11:03 PM
From: Donald Wennerstrom	1 Recommendation Respond to of 95632

I think the length of time from the "earnings bottom" to the 50 to 100 percent rise in stock price may be unknown at this point. To see what is happening at the moment, look at the chart of LRCX and WFR below. First of all with respect to the earnings for LRCX, the big drop in the estimates took place the week of 2/6. LRCX reports on a calendar quarter basis(Dec is 2nd quarter) with FY ending June 09, and next year earnings ending June 10. In other words, the present estimate is for earnings from June 09 to June 10 is -0.60, yet the stock closed today at 22.57. Looking at the chart, a bottom of 15 was set in Nov, with the stock going to the 22/23 range in mid Dec. Since then it has been bouncing around in the 23 to 19 range. When will the stock go appreciably higher than the present trading range with the present earnings estimates? Another appreciable change in estimates may occur with the reporting of FY 3rd quarter results in the latter part of April. Now for WFR. The chart is below. Here we have somewhat the same picture as LRCX. The stock price bottomed in Nov around 10 and immediately it jumped up to the 12 to 17 dollar range in Dec where it has stayed with about a 15 dollar average since then. WFR FY coincides with the calendar year so this year earnings go from Jan 09 to Jan 10 and next year earnings go from Jan 10 to Jan 11. Today WFR closed down 4.5 percent to 14.73. Again another quarterly report is due towards the end of April. The irony is that WFR shows positive earnings for the next 24 months and trades around 15 dollars per share while LRCX shows negative earnings for the next 18 months and trades around 22/23 dollars per share. That discrepancy aside, when will these stocks trade 50 to 100 percent higher that the Nov lows? It could be soon, but it might be several months yet imo. We can hope for a substantial rise over a several month period in the near future if the AI scenario comes true as forecast in their latest report this past weekend, but that may not hold and further downside could occur. Don