Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: TechHunter who wrote (21366)	3/17/1999 12:08:00 PM
From: Darryl Olson	Respond to of 25960

Stock of the Day Mar 17, 1999 Cymer: Laser Systems Maker Getting Hot If there was any doubt that the semiconductor equipment industry has turned the corner, it was largely erased Tuesday. Morgan Stanley Dean Witter and its influential analyst on chip equipment stocks, Jay Deahna, upgraded Cymer and several other companies to Strong Buy from Outperform. Perhaps more importantly, Deahna raised his earnings estimates for 1999 and 2000, delivering the message that an end to net losses is in sight. And in the highly cyclical chip equipment business, the tough times are brutal but the survivors can enjoy huge profits when the cycle turns back up. The upgrade Tuesday boosted Cymer's share price 2-5/16 or 10%. The market has been anticipating a cyclical upturn for months, though, creating a remarkable rebound in chip equipment stocks. Cymer, near $26 currently, has come back a long way from less than $6 last October. This despite a net loss in the fourth quarter of 12 cents per share and expectations for more losses in the next two quarters. For 1999 as a whole, Morgan Stanley's Deahna raised his forecast a nickle to $0.12, and the 2000 estimate was bumped up a dime to $1.25. Cymer (Nasdaq:CYMI - news) , makes laser systems used in the semiconductor photolithography process. It's excimer lasers are pushing chip making to the next level. These complex optical systems mix rare gases with halogen to produce pulses of short-wavelength light, and when they are built into chipmaking equipment they enable semiconductor manufacturers to squeeze ever-tinier circuitry onto chips. Smaller, denser chips are faster and more cost-effective, but chipmakers had to wait until there was sufficient market demand to warrant the hefty investment in new equipment. Now industry watchers expect an aggressive industrywide transition from 0.35 micron chips to 0.25 micron over the next few years (a micron is a millionth of a meter, and these sizes refer to the line width or spacing between circuitry on a chip). This transition requires an unprecedented investment in semiconductor manufacturing equipment, and Cymer's excimer lasers are a critical component in the new deep ultraviolet (DUV) machines. The company commands an estimated 80% of the market for excimer lasers. Cymer figures their DUV systems can be used to bring line widths as low as 0.10 micron. There are potentially competing technologies being developed such as electronic beam and X-ray systems, but these appear to be much more expensive than DUV. Extreme ultraviolet (EUV) may still be a decade away from use in production, but this week Cymer reported on its efforts to develop the technology for these next generation light source systems, including testing of a prototype. Cymer says it is taking a unique approach for its EUV technology: "Unlike other EUV approaches using complex high power laser-based technologies, our design converts electrical energy directly to EUV radiation by compressing and heating a small volume of lithium plasma..." A unique approach is great if it becomes the industry standard, securing Cymer's continued dominance of the lithography light source market. The risk, of course, is that one of the many other companies such as IBM (NYSE:IBM - news) develops a technology that wins out over Cymer's. That's a battle that won't be played out for many years, though. In the meantime, Cymer is at the center of the emerging generation in chip making, and investors just have to figure out what their willing to pay to own a piece of it.

To: TechHunter who wrote (21366)	3/17/1999 12:33:00 PM
From: FJB	Read Replies (2) \| Respond to of 25960

Craig, Now I'm REALLY disturbed. As well you should be, it's very clear that this press release from SVGL is going to put ASML, Nikon, Canon, and Cymer out of business in the very near future. Just kidding. You might want to wait until SVGL builds their first 157nm scanner, before letting panic set in. Who knows, maybe Cymer can build an acceptable 157nm laser in the next several years. ;-) In the meantime, it would be wise to focus on the 248nm and 193nm markets, since they will represent 99.9% of the lithography market for a few years. If you were to judge SVGL and Lambda on their press releases, you would get the impression that they dominate their respective markets. In reality, Lambda is in third place out of three suppliers and SVGL is in fourth place out of four suppliers. They need to issue press releases such as this to maintain the appearance of viability. Relax, the press release is a non-event. Bob