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Technology Stocks : Semtech (Nasdaq:SMTC) -- Ignore unavailable to you. Want to Upgrade?

To: Dave who wrote (614)	10/14/1998 5:28:00 PM
From: Jeff Bond	Read Replies (1) \| Respond to of 1225

Dave, Seems like today would have been a good day to close your position trade :) Watch SMTC and other electronics (analog, semi, 3D video, power, etc.) that report in Nov; they will probably be a good indicator for the rest of the industry biggies (INTC, etc) as a whole. SMTC seems to provide forward notice of market condition changes for a few reasons: 1. They are being force to a turns business model by larger OEM customers. This forces SMTC to VERY carefully forecast future business levels, to produce adequate quanties of product, but not so much that they end up with excess inventory. - Result? SMTC by necessity, and as a matter of solid business, MUST do as much reaseach as justifiable to maintain a leadership position, as well as be prepared for customer demand for products (whether new ones, or lots of older but still in use ones). The net result is that SMTC probably as much as anyone else is prepared to forecast future business conditions. 2. SMTC has products with extended lead times in manufacturing semiconductors, so OEM and other customers will forecast or order products in advance to account for this. That means that SMTC can be one of the earlier companies to receive revenue when for example a computer is manufactured. Also SMTC components are used early in the production process (motherboard, power, etc), so get ordered and used earlier than say a hard drive. This also tend to create conditions that make SMTC an early warning system for the industry as a whole. If SMTC has a "GOOD" quarter, it may be time to consider it an indicator that the market as a whole is ready to stabilize or improve. If SMTC has a "BAD" quarter, then it may suggest the past revenue stream was in support of holiday build-up by OEM and other customers. I'm paying attention, because I believe a lot of decisions will be made based on how this particular industry performs over the next 180 days. Good move, i'm long and have never sold a share. I also have twice as much as i had originally, I'm looking forward to doing that again at some point in the future :) Regards, JB