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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Joe Sabatini who wrote (19138)	5/3/1998 2:50:00 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

Just when you think you have this sector pegged and you know which way it is headed, a curveball is inevitably thrown: exchange2000.com These may not be 300mm purchases, but they are upgrades to .18um. This is proof that Korea plans to fund it chipmakers with the intention of generating $$ through chips, not cars or the such. Additionally, since DRAM purchases represent 40% of industry spending, these committments are indeed good news for AMAT holders. INTC recently came out and said that they would not be moving to 300mm for 2-2 1/2 yrs, in the midst of the current downturn. KIM however, that these plans can be easily changed and probably will since this is one of the most dynamic industries around. Rarely do you see a co. make a 3 yr plan that is not changed in some way during the course of its life. Circumstances change too much and dictate that a versatile approach to capex is the only way to go. INTC cannot keep those plans if their competitors begin a <<profitable>> migration to 300mm. Additionally, INTC in no way wants to telegraph its future plans to competitors. So take their 2-2 1/2 yr.delay with a grain of salt. Regards, Brian

To: Joe Sabatini who wrote (19138)	5/3/1998 11:47:00 PM
From: Paul V.	Read Replies (2) \| Respond to of 70976

Joe, >Frankly, I don't see how AMAT can't underperform over the next 1-2 years. Intel has said that they will not begin upgrading to 300mm for another 2-2 1/2 years. And it won't all be done at once. They plan on running several process sizes side-by-side for some time. The good part is that a move to 300mm on a line will require upgrading almost all of the equipment.< Trying to predict what AMAT prices will be in the future is very difficult to predict. When earnings were high prices were low and when prices were high earnings were low. The reason, IMO, is that with the AMAT Wall Street looks 6-9 months ahead. For interesting reading, see the AMAT current Value Line, date April 24, 1998. Quoting the last sentence, " If our 2001-2003 projections are near the mark, this timely issue offers appreciation potential well above the average for all stocks." With the Value Line AMAT EPS for the above range of $3.35 X 35 pe you have $117.25. With a 45 pe you have $150.75. And, with the highest AMAT 50 PE you have $167.50. During the last AMAT cycle Value Line was <:>far behind<lb> AMAT's prices run up. Just my opinions. Paul V.