Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Novellus -- Ignore unavailable to you. Want to Upgrade?

To: Steve Fancy who wrote (1502)	6/12/1998 6:10:00 PM
From: Todd D. Wiener	Read Replies (1) \| Respond to of 3813

Steve- The currency devaluations are hurting the DD makers, because competition in Asia has strong pricing power against U.S. companies. In the chip-equip market, most of the strong companies are domestic, so they won't face the same kinds of problems as the DD. Semiconductor companies are a very broad group, and while some are very weak (memory makers--same problem as DD, and logic/multimedia chip companies--due to domestic price competition), some are very strong. As a general rule, most digital chip companies are hurting right now. The ones that are outperforming are the analog companies (except ADI), such as LLTC, MCRL and my favorite-SMTC. These companies should have no problem producing continued growth for 1998 and next year. The well-managed companies are not as likely to get hurt by the PC market. SMTC is still the best choice, not only because of its excellent management and product diversity, but because it's the best value. Generally, the chip makers recover before the equipment makers, because demand for chip makers' products will need to be strong for several months before their capacity is filled. I would expect the chip stocks to begin a recovery in a few months, followed by the equips. I would avoid the microprocessor companies and memory companies. I would focus on companies that are financially strong, well-diversified, and those who haven't indicated any significant order slowdowns. Among these, I'd look for the fastest growing companies with the best returns on capital and lowest valuations. Todd