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To: Trader X who wrote (10761)	1/22/1998 1:09:00 PM
From: Trader X	Respond to of 17305

Looking ahead to VECO earnings, due Jan. 27. Next week Veeco reports earnings, which on Dec 15 they had lowered for the fourth quarter themselves to the tune of .40 - .45, below analysts expectations of .49: biz.yahoo.com The stock summarily plummeted from ~38 to ~20 in just 2 days. quote.yahoo.com The profitable question now is, with expectations so low and consensus estimates at $0.42, and as the stock price has not moved up in anticipation of an earnings surprise -- yet -- could there be a possible upside surprise in the making. Mind you, the current price at $22 actually already discounts the possibility of a disappointing earnings announcment, due to the overbearing nature of DD industry news, ie. RDRT and HTCH most prominent. Should Veeco simply not come in under the 0.42 consensus, that alone may be enough suprise to lift the price dramatically. A month of tight sideways action has done nothing to tilt the cards one way or the other as to future price moves, so TA is almost useless in this instance, except to note that $20 is support, and stop-loss should be placed accordingly. Next week should prove interesting for VECO. -Kevin

To: Trader X who wrote (10761)	1/22/1998 1:20:00 PM
From: Trader X	Read Replies (1) \| Respond to of 17305

Found a nice analysis of the CMP industry and SFAM. From the Online Investor Stock of the Day Archive, Jan 8 1998. -- SpeedFam: Riding The Rollercoaster 'Tis the season when some investors like to look for bargain stocks hit by end-of-year tax selling. The Asian crisis has added to the degree of damage this year, especially for many out-of-favor segments like chip stocks. SpeedFam International (NASDAQ:SFAM - news) is one of the ugliest cases of "crash and burn" -- it plunged from over $60 in October to less than $20 in December. Could it get any worse? Absolutely (until it hits zero, that's always the answer). But for bargain hunters with a long-term perspective, SpeedFam offers an interesting story worth investigating. There are already too many acronyms out there when it comes to tech stocks, but we have to throw in another one if we're going to talk about SpeedFam. It's CMP, which stands for Chemical Mechanical Planarization. CMP is widely regarded by analysts as one of the fastest-growing segments of the semiconductor equipment industry. SpeedFam is not only a part of it, but gaining market share. As chips become more complex, the number of times CMP is used in the production process increases, so the source of demand for more and better CMP equipment is clear. That points to faster growth in the CMP market than the overall semiconductor equipment market, 30% annually for the next several years according to some estimates. Furthermore, some analysts assert that demand for CMP equipment is independent of industry cycles, as suggested by the 75% expansion in CMP market during the 1996 chip industry slowdown. The polishing process is also a vital force behind the soaring storage capacity of thin-film memory disks such as those for computer disk drives and other data storage devices. The market for CMP gear grew much faster than industry experts anticipated to $600 million in 1997, roughly triple what it was 2 years ago. It is seen topping $800 million in 1998 and $1.4 billion in 2000. SpeedFam's expanding market share suggests revenue growth will exceed 30% in the next few years if these industry projections pan out. Analysts are forecasting an average growth rate of 30% in earnings per share over the next five years, according to the First Call report. While the Asian crisis has raised genuine concerns about a slowdown in capital equipment spending by chip makers, especially Asian manufacturers, analysts have not cut their earnings estimates for SpeedFam by much -- down a nickel to $1.77 for Fiscal Year 1998 (ending in May) and down 14 cents to $2.18 for FY99. So with the stock price currently down about 60% from its highs, SpeedFam is trading at 12.8 times Calendar 1998 earnings (The P/E is 14.5 using trailing 12-month earnings). This has been an extraordinarily volatile stock as shown by a Beta of 2.08, and with the whole chip industry so out of favor these days, investors may need a contrarian attitude as well as a cast-iron stomach. Nonetheless, SpeedFam appears to be well-positioned in one of the hottest niches of semiconductor manufacturing equipment, and the amount of selling it has endured since October is enough to at least peak the interest of bargain hunters. -- Earnings estimates revised down a nickle even after all the Asian turmoil was digested. SFAM appears to be putting in a nice bottom in the mid-20s... quote.yahoo.com Looks like a good place to accumulate shares. -Kevin