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

To: Teri Skogerboe who wrote (20107)	6/10/1998 9:10:00 PM
From: Proud_Infidel	Read Replies (2) \| Respond to of 70976

Teri, I am assuming a peak to peak increase of 2.5X in total industry revs. Since the last peak was $1.98(split-adjusted), we arrive at about $5/sh. This is an assumption first proposed by Cary Salsberg for industry rev growth(peak to peak). Assuming AMAT can hold, or increase, their margins, it is a very rough guesstimate for where we should be a couple of years down the line. The trick is knowing what is a peak; I missed last time<GGG> BTW, using this model, you come up with annualized eps growth of 40.1% if the peak is reached in 2002, using FY98 eps of $1.30 as a base; 30.9% assuming a peak in 2003. We are arriving at different #'s b/c I am not using FY98 as a base and basing my predictions on that. Rather, I am only looking at total industry revenue growth peak to peak and assuming AMAT will have mearket share, margins etc. equal to the last cycle peak. The way mgt. is handling this downturn, I think $5 may be exceeded, assuming of course an increase in total industry spending of 2.5 times the last cycle peak. This is the underlying assumption. Brian BTW, in my last post I said I was using FY98 as a base year. However, I was only doing that for the purpose of showing that given the above assumptions, AMAT should prove to be an incredible growth stock over the coming years(40% annualized). I did not use FY98 eps and calculate my predictions off of that.