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

To: Paul V. who wrote (22010)	7/21/1998 8:17:00 PM
From: Big Bucks	Read Replies (5) \| Respond to of 70976

PV, I think we are in a short squeeze situation in AMAT. There is no compelling reason that the markets and the stock is as high as it is. I must go back to fundamentals, at some point valuation comes into the equation. I, for one, am unwilling to overlook the earnings outlook going forward. If sales are down then earnings are down, therefore profits are down. Since there is no major equipment buying/selling opportunity going to happen in an overcapacity environment (in the near/mid term) then why should the stock maintain a high relative valuation under such conditions. We have not seen the worst, IMO, but the stock will likely rally on any announcement of further layoffs as a cost/expense cutting measure. IMO the stock will reach "the bottom" once the market makes a correction to realistic valuation levels. My guess, sometime between late Sept thru October. What other large cap stocks have announced such a dreadful earnings forcast, in a shrinking growth environment, that haven't been pummeled by investors/funds. At some point wishful thinking will give way to frustration or reality and the stock price will reflect the earnings/profit outlook. Just my opinion, BB