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Technology Stocks : Novellus -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (1991)	3/5/1999 3:02:00 PM
From: Duker	Read Replies (1) \| Respond to of 3813

<<anybody put 2 and 2 together and asdk themselves why this company needs so much money immediately after the biggest semi equipment boom in the history of the world? can anybody say - non cash flow business?>> Skeeter, I would be careful on this one. The numbers I am looking at do not support your position. Sure, in 1997 they had negative free cash flow of $13.5mm (Net Income + D&A +/- changes in WC - CapEx). That was a very sloppy year due to the Varian acquisition. In 1996, they generated almost $32mm in FCF ... in 1995, the figure was almost $40mm ... not terrible numbers for a growing company that spends a reasonable amount on R&D&E. I have no vested interest here. I do not own NVLS, nor do I think it is particularly cheap. One of the reasons that it is not particularly cheap is that it has a pretty great business model. The are very good manufacturers (AMAT wishes they could get Austin to work like NVLS) ... and cash generation is pretty damn good. Just my opinion. N.B., the 1998 numbers (I have no 1998 10-k) are probably not great ... but I would argue that 1998 was one of the worst years in the history of the business. Moreover, I do not have the 10 year history. Maybe those numbers suck (though that is not my recollection). --Duker

To: Skeeter Bug who wrote (1991)	3/5/1999 4:36:00 PM
From: Math Junkie	Read Replies (2) \| Respond to of 3813

<<anybody put 2 and 2 together and asdk themselves why this company needs so much money immediately after the biggest semi equipment boom in the history of the world?>> Since they are in an industry with strong up- and down-drafts, the ones who survive best are the ones with lots of cash on hand. As the former CFO of a company I worked for said, you raise money when the market supports it. Also, I don't know what you've been smoking, but if you call this "immediately after the biggest semi equipment boom in the history of the world", it must be a pretty potent blend. <<can anybody say - non cash flow business?>> Again, you've got a good imagination. I don't have their cash flow figures, but with net income of $1.51 per share for the year and $0.23 per share for the quarter, it can't have been too bad. novellus.com