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Technology Stocks : Cymer (CYMI) -- Ignore unavailable to you. Want to Upgrade?

To: Nevin S. who wrote (20835)	1/31/1999 7:57:00 PM
From: Clarksterh	Read Replies (1) \| Respond to of 25960

Nevin - At $700M in sales per year that is an EPS of $2.80 if you assume the same net margins as it had at the last peak. Thus, for a P/E of a little over 30 it is possible to get to $100. But I would note that you are taking as a given that Zeev's estimate of 1000 units per year is accurate - as if they built the capacity to exactly match expected peak demand during the next upturn. I suspect the peak demand will be substantially higher than that: 1) Assume that DUV lasers move from being used in 20% of the layers of 25% of chips (today) to an average of 40% of the layers of 60% of chips in 2002. That a 500% increase in installed base needed 2) Assume that the number of layers increases by 25%. 3) Assume that the industry grows plants by 10% per year for a 30% increase by 2002. (Chips production should grow substantially faster than that, but much of it is accomplished by more efficient production like the 6000 series lasers.) That's an installed base 8 times larger than today - 4000 lasers in 2002. If you assume a lifetime of 2-1/2 years (?) that is still 1600 lasers per year, and that doesn't account for the growth that happens that year. The big questions I haven't covered are: market share?, macro-economy? ... . Any others? Certainly there is some optimism in here, but it is not completely unrealistic? Clark