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Technology Stocks : Align-Rite Int'l (MASK) Undervalued compared to PLAB DPMI -- Ignore unavailable to you. Want to Upgrade?

To: BillyG who wrote (117)	10/26/1997 8:22:00 AM
From: Joe Dancy	Read Replies (2) \| Respond to of 388

A agree with your comments. Even if this quarter's earnings do not meet expectations, and I think they will hit the consensus or come close, long term they have a nitch here. <<There's plenty of non high-end work out there for MASK. Some have even suggested that there is more work out there for MASK if DPMI and PLAB are ignoring the bread and butter mask business. With all the money DPMI and PLAB are investing in high resolution and phase shift mask facilities, you've got to believe that MASK's cost structure is better than DPMI and PLAB.>> Joe

To: BillyG who wrote (117)	10/26/1997 10:37:00 PM
From: Bookdon	Read Replies (1) \| Respond to of 388

MASK has bought mostly used mask-making equipment, and the lowest cost CORE tools over the last several years. This focus on mid to low end mask making hits PLAB and DPMI where they focus the least effort. According to one ex-DPMI employee, DPMI has ben putting small (less than $5 million/year) customers on allocation recently (66% of requested volume). MASK can pick that business up at good margins. High end mask-making tools require a substantial "learning curve" investment, and don't become fully productive for 6 to 12 months after installation. COREs, on the other hand, "hit the ground running" and become productive within a few weeks. MASK has a sound strategy for good times. In bad times, as the low cost producer they have a potential advantage, but DPMI and PLAB can choose to sell below total costs, just to cover their fixed costs.