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

To: Proud_Infidel who wrote (27651)	1/11/1999 11:34:00 AM
From: Anthony Wong	Read Replies (1) \| Respond to of 70976

Applied Materials Raised to 'Strong Buy' at SG Cowen, target $65 Bloomberg News January 11, 1999, 10:34 a.m. ET Princeton, New Jersey, Jan. 11 (Bloomberg Data) -- Applied Materials Inc. (AMAT US) was raised to ''strong buy'' from ''strong buy'' by analyst Tia-Min Pang at SG Cowen. The 12-month target price is $65.00 per share.

To: Proud_Infidel who wrote (27651)	1/12/1999 11:48:00 AM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

Fab spending drought sets stage for next boom period, say analysts By J. Robert Lineback PEBBLE BEACH, Calif. -- At best, semiconductor capital equipment spending might pick up again in the second half of 1999 following a year of severe cutbacks in wafer fabrication capacity worldwide, according to speakers at the 1999 Industry Strategy Symposium here this week. The forecasts at ISS called for a flat year of investments in chip production during 1999 as cautious semiconductor makers begin an apparent full year of recovery. "The industry completely ignored the warning signs in 1997, and it kept investing at 225 miles per hour," said Jean-Philippe Dauvin, group vice president and chief economist at ST Microelectronics, who presented an industry forecast before the annual meeting. According to the European chip executive, the industry ended up closing 26 wafer fabs in 1998, or about 10% of its capacity, after the false recovery signs of 1997. And, chip makers canceled or postponed $38 billion of planned investments, he added. But now, Dauvin warns, the chip industry appears to have gone too far in its cutbacks, spending only $500 million a month on capital equipment at the end of 1998. "What we're doing is creating another situation for under-capacity [in 2000 to 2002]," he told the group. Industry observers, making presentations at the meeting, agreed. Unlike last year's meeting, rival analysts narrowed their differences and essentially called for a flat year of investments in wafer fabs in 1999. Dataquest's Clark J. Fuhs today will predict that equipment spending on fabs will drop 1.7% in 1999 to $15.2 billion after falling 23.5% in 1998. VLSI Research Inc.'s G. Dan Hutcheson will tell the group that fab equipment spending will grow just 1.7% after collapsing 28.4% in 1998. A year ago, the two rival analysts presented forecasts that were widely different. Dataquest's Clark was calling for a 2% increase in fab spending in 1998 while VLSI Research's Hutcheson predicted a much higher growth rate. Soon after the year began, all market researchers began revising their outlooks partly because of the Asian financial crisis but later because too much chip-making capacity existed worldwide. In 1998, semiconductor suppliers were spending a healthy 21% of their sales on new equipment, but previous years of overspending set the stage for the worldwide fab glut, according to analyst Bill McClean of IC Insights Inc., who presented the chip forecast at the meeting. In 1999, McClean said, industry investment will fall to about 19% of sales, setting the stage for the next round of chip shortages and increases in average selling prices. Most forecasts for 1999 semiconductor growth remain modest, but in the second half of the year revenues could jump if improving conditions hold steady (see story from Jan. 1 issue of SBN). During the ISS meeting, Dauvin said chip sales in the fourth quarter of 1998 were 10% higher than they were in the third quarter. After an expected pause in the first quarter this year, semiconductor revenue growth is expected to continue to gain momentum, he said at the meeting, hosted by the Semiconductor Equipment and Materials International (SEMI) group. After three years of recession in the semiconductor industry, Dauvin now expects to see three strong years of revenue growth--23% increase in 2000, 29% in 2001, and 31% in 2002. He forecasts the next downturn in 2003, when worldwide chip revenues will grow by just 5% and industry sales should hit $290 billion vs.$124 billion in 1998. semibiznews.com