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To: Frank Ellis Morris who wrote (14158)	12/8/1997 6:48:00 PM
From: Sonki	Read Replies (2) \| Respond to of 27012

APPLIED MATERIALS INC. (AMAT) 34 3/8 -5/8. Shares of supplier of wafer fabrication systems and services to the semiconductor industry are trading lower today after SoundView Financial reduced its fiscal 1998 EPS estimate, although it kept a bullish ratings stance on the stock. Due to the company's high sales exposure from the Asian region, SoundView has lowered its fiscal 1998 EPS estimate to $1.99 from $2.15 a share. This latest estimate compares with profits of $1.39 a share in fiscal 1997 on revenues of $4.07 billion. However, the firm continues to rate the stock a short-term and long-term "buy," which has allowed the stock to limit its losses that might have resulted otherwise from the earnings cut. Given the current 1998 forecast, AMAT is currently trading at 17 times next year's projected earnings, well below its sales growth trend of 35% and projected earnings expansion of 43%. Even with the latest downward earnings projection revision by SoundView, the stock is very much undervalued as the concerns attached to the problems with Asia are severely depressing the stock. If AMAT is able to offset only a portion of its Asian exposure (currently it generates 53% of its revenues from this region), the company should be able to easily match market expectations and allow the stock to rebound. However, with Asia remaining the wild card in the earnings picture, this stock is not likely to recover soon, although its fundamentals suggest that its stock should be tradingat least 25% higher BTW: orcl is going to be down a few points tomorrow as they missed by .04 and came in at 1