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

To: Sun Tzu who wrote (29792)	4/29/1999 11:32:00 AM
From: Carl R.	Read Replies (2) \| Respond to of 70976

It is not really true that many DRAM makers have gotten out of the business or stopped ordering equipment. As for AMAT being overpriced, it is not as overpriced as it was. <G> I do not argue that AMAT was the most overpriced of the semi-equipment makers, but it always is. My guess is that there revenue for the next 4 quarters will be between $4-4.5 billion, or about $11/share. This implies a forward P/S of 4.5 based on a price of 50. But I would suggest that in the early stages of a recovery the P/S multiple should be higher than the range you indicated. Thus I doubt that the price will fall to the $39 implied by your formula. Rather I suspect that an absolute bottom would be $44 or so, though I think the chance is very good that 50 will hold. Carl