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

To: Henry D who wrote (564)	3/31/1999 6:32:00 AM
From: Mark Oliver	Read Replies (1) \| Respond to of 723

Yes, ESIO is not a typical semi equipment company as they do have other businesses, but they are still very dependent on buying patterns from semiconductor makers. It is said that there are front end, back end and consumable sales to maker semis. The front end is often associated with wafer fab and this can be very capital intensive and often gets it's peak investment as new facilities are brought on line. Consumables are just that, items that must constantly be replenished to make semiconductors. These items with the things like photo masks. Back-end is the area that Electro-Scientific sells to. Other companies in this group have also done pretty well liked Teradyne. The back-end is usually associated with equipment that is used to repair, test and assemble semiconductors. The back-end has fared better than front-end because many of the front-end processes continued use old equipment which has been able to increase productivity yielding greater units. When these greater units hit the back-end more equipment is needed to handle the increased volume. It is also said that back-end orders have less lead time and therefore demand picks up slows faster than front-end equipment. I believe Electro Scientific has held up better because they have a very strong balance sheet, they have leading market share in all their product categories, margins are high and product cycles still have great potential. The final winning factor is solid management. Whether ESIO can hit 80 by late 99 is anybody's guess. It sure wouldn't hurt my portfolio if it did. Regards, Mark