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

To: robert b furman who wrote (64690)	6/24/2014 12:57:09 PM
From: Donald Wennerstrom	1 Recommendation Recommended By Return to Sender Read Replies (1) \| Respond to of 95536

MORGAN STANLEY EXPECTS MEMORY BOOM TO CONTINUE FOR MICRON TECHNOLOGY 9:14 AM ET 6/24/14 \| S&P Capital IQ In a report published Tuesday, Morgan Stanley analyst Joseph Moore reiterated an Equal-Weight rating on Micron Technology (NASDAQ: MU). In the report, Morgan Stanley noted, "We expect DRAM to remain reasonably tight over the next several months. With the stock up ~47% YTD, >3x tangible book value, and 10x our estimate for peak EPS, we prefer a better entry point. We continue to believe that memory stocks have a relatively well defined earnings cycle despite acknowledging some secular positives; still, structural improvements are significant and should drive a longer profit cycle."

To: robert b furman who wrote (64690)	6/25/2014 3:36:35 PM
From: Donald Wennerstrom	2 Recommendations Recommended By Gottfried Return to Sender Respond to of 95536

Bob, You are right about AMAT and INTC breaking out very nicely. However, it remains to be seen where we go from here. Just a note that amat and intc are breaking out very nicely - sector rotation adding to breadth - not seen for a very long time. The table and chart below show a couple of different looks at the action over the past year. For the table, we are looking at a year over year comparison of a few key parameters for both companies. At this point a year ago in 2013, Nxt Yr earnings were estimated at 1.13. At this point in time as of last Friday, the estimate is now 1.07, down only 6 cents from the estimate last year. Comparing Nxt Yr estimate for 2013 of 1.13 to the Nxt Yr estimate a year later, the difference is +18.6%. Last year the closing price was 15.08 and as of last Friday the close was 22.75, a gain of 7.67. Price targets have increased accordingly, but the closing price last year was within 95 of the mean target price, this year the difference is now 104 percent. For INTC, an incredible happening has occurred. The Nxt Yr estimate in 2013 was 2.02, and now a year later it is still 2.02, no change. Boy, are those analysts good or what? Now the Nxt Yr number is at 2.11, or a 4.5% increase compared to last year's number. Notice how PEs have increased for both Cur Yr and Nxt Yr compared to the year ago numbers. Price targets have gone up, but remain at 102 percent, the same as last year at this time. Now looking at the chart, INTC meandered along the "0" line until Feb of this year, then an upward trend started that is still continuing. AMAT only gained about 10 percent from the beginning of the chart to Feb, then it started a nice uptrend as well. Both stocks pulled back a little in the Apr/May period, then resumed a sharper uptrend. From Feb, AMAT is up about 40 percent, and INTC is up about 30 percent. I doubt this uptrend for both stocks will continue as shown during the last 8 weeks without some added good news.