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

To: Justa Werkenstiff who wrote (20331)	6/13/1998 10:46:00 PM
From: Ramsey Su	Respond to of 70976

Stiff, Based on the current btb trend, it is a pretty good bet that 1999 earnings will be below that of 1998. AMAT and other semi eq companies, however, trade at prices far in advance of actual earnings, a lot more so most industries. I agree with Jacob that AMAT started a run towards the 40s when the street is expecting the sector to recover in 1999, regardless of the dismal outlook of 1998. Unfortunately, it now looks like it may get worse before it gets better, therefore the downturn. Are we at the bottom here? Ramsey

To: Justa Werkenstiff who wrote (20331)	6/14/1998 12:14:00 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

Justa, I must say that you are a voice of reason anongst a crowd of Cassandras. One could look to headlines and never buy AMAT for any number of reasons: tight labor markets causing wage inflation, Japan's current banking mess(and overall economic mess), riots in Indonesia, or many other reasons you could stay awake worrying at night. The point remains that IC's are intgral to life as we will know it going forward. There are many chip makers. To compete and stay in the game they need to spend $$. Are we to believe the IC is dead and eps will fall from $1.39 for FY97 to $1.38 for FY98 to $1.00 for FY99? If this is indeed the case, we're going to have one he**uva good 2000 since capex delayed now only means future revs packed into a shorter window, when all of the fabs finally upgrade. I would like to know what JD of MS thinks will be the total industry revs for '99. I know he now sees spending down for '98 20-22%, and with the eps downgrade for FY99 I assume he sees another overall down year for the sector next year. Brian

To: Justa Werkenstiff who wrote (20331)	6/14/1998 3:07:00 PM
From: Fortinwit	Read Replies (1) \| Respond to of 70976

He sees 1998 at $1.24 and 1999 at $1.00 eps down from $1.85. Yes, I believe he may well be the first analyst to go one record that 1999 will be worse than 1998 for AMAT. Sure would like to hear his reasoning behind that idea. JW: What we've seen so far is the consequence of the effects of massive oversupply in the semi world. I believe that Deahna is now looking at the other shoe falling, i.e. demand. Remove demand for chips (Asian recession, or worse) from the oversupply we're seeing (now predicted to run into Mid-99) and $1 for 99 isn't out of order. On another note, it seems to me that far, far too many people just went bullish on this stock (and other semi-equips) because of sudden perceived 'value' due to the price drop. To paraphrase the kid, the only economic factor that has changed for the better is that the price has gone from $39 to $28. And as JJCramer would say, just because the price has dropped a lot, doesn't mean it cannot fall further (read the DDs, the oils, and COMS threads). I'll be looking to short the weak sisters on any bounces... F.