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Technology Stocks : Speedfam [SFAM] Lovers Unite ! -- Ignore unavailable to you. Want to Upgrade?

To: Mr. Sam who wrote (2946)	4/20/1998 2:03:00 AM
From: GuinnessGuy	Read Replies (1) \| Respond to of 3736

To All, Here's Lehman's spin on the book-to-bill: ======================================= Headline: Semiconductor Equipment: SEMI Book-to-Bill Ratio is Weakest since Oct/96 Author: Edward C. White, Jr., CFA 1(212)526-4744/Tolomy Erpf 1(212)526-5744 Company: AMAT, KLIC, KLAC, NVLS, PRIA, ETEC, SFAM, SVGI, TER, LRCX, LTXX Country: ECO CUS Industry: SEMICO Today's Date : 04/17/98 * Semiconductor Equipment and Materials International, the trade association for the semiconductor equipment industry, publishes monthly (3-month moving average) shipment, order and book-to-bill statistics. * The book-to-bill ratio for the 3-month average ended in March for total equipment was 0.80, down from a revised 0.91 in February. Total shipments and total orders were down 12.4% and 1.4%, respectively from February levels. * The front-end ratio was 0.78 in March, down from a revised 0.86 in February. Orders for this sector have continued to sequentially decline over the last four reporting periods. * The assembly & test ratio declined to 0.86 in March from a revised 1.01 in February. Orders for this sector have continued to progressively weaken over the last four reporting periods. Highlights: The semiconductor equipment market continued to weaken in March. Three-month average orders for March declined 12.4% from February, roughly in line with the 10.9% decline in the January to February reporting periods. This represents the fourth month of sequential decline in orders since November, 1997. The decline in the overall book-to-bill ratio was due to weak growth in orders in both the front end and the back end, and is the lowest reported book-to-bill ratio since October, 1996. Shipments also declined a modest 1.4%, representing the fourth month of sequential declines since November, 1997. In addition to weakness in equipment purchases by DRAM manufacturers and Asian chipmakers, U.S. based semiconductor equipment manufacturers are now experiencing softening in orders from U.S., Taiwanese, and non-DRAM manufacturers. While anecdotal evidence suggests that Korean customers are beginning to make limited purchases again, their financial constraints hamper any significant impact. Front-end equipment orders and shipments in March declined 13.2% and 4.2%, respectively, versus declines in orders and shipments in February of 11.9% and 10.4%, respectively. This is the sixth sequential month during which growth in orders has been less than the growth in shipments. Test & Assembly orders in March declined 10.6% from February levels, following an 8.8% decline in January. Shipments in March increased 5.4%, versus a decline of 1.4% in February. The data from the last four reporting periods suggests that this sector is suffering not only from the fall-off in buying subsequent to substantial capacity additions which took place in 1997, but also from the hangover of the seasonally robust end-of-fourth quarter buying spree. We continue to recommend select companies in the semiconductor equipment sector which stand to benefit from technology buying of 0.25 micron equipment by chipmakers. The key beneficiaries of 0.25 micron technology: Applied Materials (AMAT, $35 7/16, Rated 1); KLA-Tencor (KLAC, $38 7/8, Rated 1); Etec Systems (ETEC, $60 1/8, Rated 1); SpeedFam (SFAM, $29 1/8, Rated 1); PRI Automation (PRIA, $24 1/4, Rated 1). Monthly (3-Month Average) Semiconductor Equipment Book-to-bill figures: ___Front-End Test Assembly Test & Assembly Total May 0.92 ............ 0.75 ............. 0.52 .............. 0.87 Jun.. 0.91 ........... 0.71 ............. 0.78 .............. 0.87 lehman.com

To: Mr. Sam who wrote (2946)	4/25/1998 5:30:00 PM
From: GuinnessGuy	Read Replies (1) \| Respond to of 3736

Mr. Sam, Caught this listening to the Cymer conference call and thought that you would be the person that would have the answer. Here is the relevant passage in a transcript of the call(Thanks to ScottMcI): ================================================================ *Hays: Ok, thanks. Just a follow-up - I was interested in your comments with regard to bottlenecks to reduced line widths. Could you give us an idea perhaps of what some of those other issues that your chipmakers are facing are? In order to reduce line widths? Akins*: Well for example, let's stay to something relatively close to the photolithographic process, the new photoresist - the new high-sensitivity chemically-amplified photoresist - of course have to see stripping technologies, ashing technologies, as well as cleaning technologies, and etch technologies, which are compatible with those new resists. Also, the CMP process, which of course is essential to maintaining flatness for increasing the depth of focus or utilizing the relatively small depth of focus for lithography tools, is seeing its set of challenges as well.[Emphasis mine - C.S.] It's really a whole set or whole family of processes that need additional tuning over time. This is not unusual, and this process will never cease, as all chipmakers will be continuously improving those processes in an attempt to improve their yields and reduce costs. Message 4196200 ================================================================ Do you know what the CMP challenges referred to are, and, if so, do you know how well Speedfam is addressing these relative to their competitors. Also, does Applied Materials have any material advantage here due to their more intimate knowledge of the overall semiconductor manufacturing processes? Thanks... Craig