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Technology Stocks : Cymer (CYMI) -- Ignore unavailable to you. Want to Upgrade?

To: GREATMOOD who wrote (15694)	3/11/1998 11:52:00 AM
From: Robert Douglas	Read Replies (5) \| Respond to of 25960

Today's announcement about the "extensive and progressive agreement" between Canon and Cymer seems to be a non event in the eyes of the market. While there certainly doesn't seem to be much substance to the announcement I believe it is telling in several ways. For one it shows that Canon is treating Cymer more as a partner in DUV rather than some "off-the-shelf supplier" that can be dealt with like GM treats it's parts suppliers. Surely Canon realizes that the future of both companies is joined at the hip and that cooperation is essential because they can't bop down to Fleck-Mart and buy some DUV bulbs if Cymer is all out. But more importantly, this is just another indication of how critical service and spares will be in the future. Others have posted some estimates on what they think Cymer will earn from service in the future. I wouldn't be surprised if 3 years from now Cymer is earning half of their profits from this area. This is high margin, repeat business that Wall Street analysts love to discount to kingdom come. And if you discount it with a small enough rate, the present value of these earnings will be huge. With all the distractions from Asia taking center stage, it looks like Cymer is quietly readying itself for a big run. (IMHO)