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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (6954)	9/19/1998 10:47:00 AM
From: Katherine Derbyshire	Read Replies (1) \| Respond to of 10921

>>now the following up question. Jillions of R&D dollars had been spent on 300mm stuff by AMAT and other would be competitors. It is my understanding that it is ready to go NOW if the industry had not suffered such a major set back. << Depends on your definition of ready to go. The tools exist, but are fairly immature in many cases. Also, the original 300 mm transition schedule was much more aggressive than the schedules for previous transitions. It's not clear that it was ever realistic, even before the current setback. (Very interesting presentation at the BACUS photomask meeting last week about generation lifetimes, wafer lifetimes, and so on. I'll post the link to my coverage once I get it written.) >>The longer the "next" generation technology is pushed out, does it not create an uncertain window period for the semi eq manufacturers? By that I mean what is the possibility of a few new approaches, such as Rambus, to emerge, now that they have a little more time?<< Yes, the delay creates uncertainty. I'm not sure your specific example is relevant, though. Chip architectures (like Rambus) are distinct from chip fabrication technology. >>Has the semi industry learned their lesson about supply and demand?<< Companies that haven't learned the lesson are likely to take themselves out of the picture by going bankrupt. >> Would there be an OPEC of the semi conductor producing nations? << Doubtful. Intra-national competition is too fierce for any country to establish the necessary consistent policy. >>Would the street finally recognize that semi equipment sector is not growth but cyclical, thereby assigning a different PE when valuing the sector?<< Doubtful. That would require more rationality than the street seems capable of. Katherine

To: Ramsey Su who wrote (6954)	9/19/1998 12:42:00 PM
From: Clarksterh	Read Replies (2) \| Respond to of 10921

Ramsey - Would the street finally recognize that semi equipment sector is not growth but cyclical This all depends on your definition of cyclical. I, for one, do not think of the SEMI industry as being cyclical, but as being high growth with cycles superimposed. Are there any high growth areas for which this is not true? (remember the networking industry collapse of last year?) I'll concede that SEMI is more cyclical than I expected, but that doesn't preclude growth. To assume that it is purely cyclical (no new highs) based on the last two years is like the blind man feeling the elephant's trunk and assuming it's a snake. As for thereby assigning a different PE when valuing the sector? well, maybe. At least until, during the next extended up cycle, they forget about the last cyclical downturn. Clark