Semiconductor Capital Equipment Stocks Discussion

Top 11. Feb 7, 1998 7:38 AM

» Kirk - Week's Recap Interesting article <a href=http://www.nytimes.

Week's Recap

Interesting article HERE on why we might not have had our bottom yet.

My chart of semicap stocks here. I wonder if I should start charting Micron too?

Book to Bill ratio article here.

We've had a great run up in just a few weeks. My Picks one month ago:

_____ Jan 9 _________Feb 6

AMAT $28.00 _______ $36.00 up 29%

LRCX $22.75 _______ $25.375 up 12%

UTEK $18.75 _______ $22.875 up 22%

Kirk Lindstrom

Editor: Personal Finance and Investing

My Home Page

MyFinance Page

-- posted by Kirk

Top 12. Feb 7, 1998 9:51 AM

» Karin - MU has been downgraded by Brouwn Brothers from HOLD to AVOID on

MU has been downgraded by Brouwn Brothers from HOLD to AVOID on Feb 5.

-- posted by Karin

Top 13. Feb 7, 1998 12:15 PM

» Kirk - Thanks Karin. I'm not thinking of buying, just interested in se

Thanks Karin. I'm not thinking of buying, just interested in seeing if movements in its price correlates or predicts semiconductor capital equipment stock. I don't buy commodoty companies, though MU might make an interesting trading stock if I were to ever decide to give that a try. 8)

Kirk Lindstrom

Editor: Personal Finance and Investing

-- posted by Kirk

Top 14. Feb 12, 1998 2:13 PM

» Kirk - Semicaps may go on sale tomorrow following this announcement:

Semicaps may go on sale tomorrow following this announcement:

Lam Research Corporation Announces Company Restructuring and Reduction
in Workforce

FREMONT, Calif.--(BUSINESS WIRE)--Feb. 12, 1998--Lam Research
Corporation (NASDAQ:LRCX - news), a leading supplier of wafer
fabrication equipment to the worldwide semiconductor industry, today
announced a restructuring of the company which includes a reduction in
its global workforce of approximately 14 percent. Lower prospects for
orders and revenue driven primarily by the Asian financial crisis are
cited as the reason for the action. The company will restructure to put
more focus on its core etch and Chemical Mechanical Planarization (CMP)
product groups and reduce its flat panel display and thermal CVD
operations. Manufacturing operations will be downsized and consolidated.

As a result of the organizational changes, approximately 700 employees
at locations throughout the company's global operations will be
affected.

Lam will take a pre-tax restructuring charge to earnings in the range of
$80 million to $85 million, or $1.47 to $1.57 per share, in the third
quarter of fiscal 1998. The restructuring charge includes costs related
to severance compensation and consolidation or closure of certain
facilities, as well as write-offs of assets utilized in affected
operations.

''A weaker order outlook over the next several quarters has made this
difficult decision necessary,'' said James W. Bagley, chief executive
officer for Lam. ''Industry demand for semiconductor equipment has
softened as a result of the financial crisis in Asia and the continued
depressed pricing environment for DRAM devices. This action will allow
us to align our cost structure with prevailing market conditions,
enabling us to fund research and development programs critical to our
long-term success.''

Lam Research Corporation is a leading supplier of wafer fabrication
equipment and services to the world's semiconductor industry. Lam's
headquarters are located in Fremont, California. The company's common
stock trades on the Nasdaq National Market under the symbol LRCX. Lam's
World Wide Web address is http://www.lamrc.com.

''Safe Harbor'' Statement Under the Private Securities Litigation Act of
1995: Except for historical information, this press release contains
certain forward-looking statements, including, but not limited to, those
statements related to the proposed restructuring and its effect on the
company's level of profitability. These statements are subject to
various risks and uncertainties that could cause results to differ
materially, including but not limited to the sufficiency of the size of
the restructuring, expansion of the financial crisis to other regions,
and other risks detailed from time to time in the company's SEC reports,
including the report on Form 10-K for the year ended June 30, 1997 and
the Form 10-Q for the quarter ended September 30, 1997. The company
assumes no obligation to update the information in this release.
------------------------------------------------------------------------
Contact:
Lam Research Corporation
Lisa Garber, 510/572-4538 (PR)
lisa.garber@lamrc.com
Kathleen Bela, 510/572-4566 (IR)
kathleen.bela@lamrc.com

------------------------------------------------------------------------
More Quotes and News:Lam Research Corp (Nasdaq:LRCX - news)Related News
Categories: computers, household/consumer, semiconductors
------------------------------------------------------------------------

Kirk Lindstrom

Editor: Personal Finance and Investing

-- posted by Kirk

Top 15. Feb 12, 1998 3:57 PM

» PeteM - Thanks for the warning, I will brace myself. Pete McCandlish

Thanks for the warning, I will brace myself.

Pete McCandlish

-- posted by PeteM

Top 16. Feb 12, 1998 4:09 PM

» PeteM - This stock seems to have been beat up by the shorts as well.

This stock seems to have been beat up
by the shorts as well.

Perhaps if this stock really gets hit I'll buy
a rack of LAM. or is that lack of RAM

Pete McCandlish

-- posted by PeteM

Top 17. Feb 12, 1998 5:57 PM

» Kirk - Interesting re looking at shorts. Even AMAT has a good amount o

Interesting re looking at shorts. Even AMAT has a good amount of shorts thru 1/98

short interest site

I entered amat, lrcx, klac & Utek. 3 of the 4:
Utek, Lrcx and Amat were about 3x their Aug97 short/(daily volume) numbers.

I think this is normal for bottoms. Layoff the dead wood and get out of marginal businesses and be stronger when the cycle turns. Lets just hope it really turns!

Kirk Lindstrom

Editor: Personal Finance and Investing

-- posted by Kirk

http://talk.techstocks.com/~wsapi/invest...

Top 18. Feb 12, 1998 6:05 PM

» Kirk - The following are some highlights gleaned from the Conference Ca

The following are some highlights gleaned from the Conference Call LRCX had
moments ago with the investment community. It is brought to you as a courtesy of:

SI - STOCK SWAP and Andrew Vance

LRCX - Conference Call Notes (as best as I could take. Pardon the errors both in
typing and interpretations)

Restructuring: layoff 700 employees (14% of workforce)
$80-85 million write off in the 3rd quarter or about $1.50 share
Cost to curtail Flat Panel and CVD business and people costs to the business.
Manufacturing of these products is being shutdown other than to barely sustain spare
parts and accommodate existing customers wanting to finish out a planned installation
toolset. Asset write down of Wilmington factory ($32 million), Severance pay $19
million,
$32 million lease cancellations for buildings. Reducing businesses and cutting out R&D
expenses. Needed to do this to sustain business at Break Even. Essentially, LRCX is
now exiting the Flat Panel and Thermal CVD business. This is a positive for both
NVLS and AMAT)
30% of write off related to Flat Panel and CVD (people, plant, equipment), severance,
leases, and building/equipment.
70% Large hit in manufacturing and taking buildings out of service for the time being.
Will lose 250 manufacturing employees. The will be stripping a building and writing off
the leasehold improvements such that they could re-outfit it more in line with its future
needs.

No cutbacks in CMP other than temporary workforce. Reliability testing going on at a
customer site. Software performance is a point of concern at this juncture since it is still
an unknown. So far no issues but not enough verification.

High Density Plasma CVD system business is close to having a good opportunity for
company. Need to be successful in this endeavor with a specific customer to push
forward in this technology. fingers crossed here. If they are not successful, it may be
another business they exit.

Overall Backlog is very small. $5 million loss expected for upcoming quarter which
translates to a 0.13 loss per share.

Over past 3 weeks, they have been looking at the forecasts and the Pacific Rim
business. Cannot support a $255-275 million run rate over next 2-3 quarters. Break
Even
at $245 million.

This quarter $240 million 13 cent loss earnings per share
Revenues of $240-250 next 2 quarters, at best.

Not optimistic for calendar year 98. Believes it will be 15% below last year. I think
they
also mentioned they need to work on service and customer support in the field.

Korea/Japan - downside from both at around 15%. Doesn't believe the Rest of World
make up this loss of business. Bad first half but better second half. They expect to lose
marketshare in Korea. Orders in Korea were essentially zero due to lack of
LOCs(letters of credit).

With everything that is going on they still have ability to respond to any upside if this
outlook changes.

Japan weaker than thought - little impact on LRCX. Softening seen in their Logic and
DRAM activity.

Near term uncertainty on timing in Taiwan. Delays not cancellations.

North America Flat to up with slight push outs. However, CEO seemed concerned
with
Samsung, Austin TX and Hyundai, Eugene OR.

Europe looks good and on plan with the exception of Hyundai, UK. Uncertainty there.

Softening in Foundry business is being seen. No one understands what is going on in
Taiwan. 0.35u capacity is being underloaded. Heavily loaded at 0.50u and above.
Prototyping work at 0.35u has not taken off in larger volumes from the customers.
0.35u

products are not being put onto market as fast as predicted.

Gross margins are going to be affected this quarter that we are presently in. Next
Quarter's Gross Margins should be back on track.

Wilmington was where they were building the alliance platforms and the Drytek
systems.
The Alliance platform will be shifted and moved to the Fremont facility.

1999 will be a very good year as Asia Stabilizes.

BOOKINGS AND BACKLOG ARE ISSUES WITH NO REAL VISIBILITY.

Kirk Lindstrom

Editor: Personal Finance and Investing

-- posted by Kirk

Top 19. Mar 18, 1998 7:29 AM

» Kirk - To: +MrGreenJeans (2240 ) From: +Kirk

To: +MrGreenJeans (2240 )
From: +Kirk
Wednesday, Mar 18 1998 10:28AM EST
Reply # of 2244

Thanks for the reply, MrGreenJeans, but you answered the wrong question. I have a very long
position in Intel (7x gain) and am not considering adding to it as I feel my index and mutual funds
plus my original position are sufficient.

My original question is at:
http://talk.techstocks.com/~wsapi/invest...

I do feel that there is a buying opportunity in the semiconductor capital equipment sector, for Lam
and Ultratek in particular, and I was asking which one people thought had a better potential for
big gains. I posted some charts here that show UTEK, Lam,
AMAT and Intel to illustrate that Lam has fallen further from it highs and might offer a reasonable
alternative.

I am looking to pounce on some bargain priced shares of either LRCX or UTEK, but have
reasonable positions in both as well as a good position in AMAT (at a $12 cost basis for AMAT)
so there is no urgency should the stocks decide to rocket before I buy more.

My strategy is a derivative of Bob Brinkers where I am trying to ride the large caps as long as I
can then transfer money into the small (UTEK) and mid (LRCX) cap semicaps just as the news for
them can't look any worse which is when they will start to rise. I am a "new age" thinker that
believes we see "rolling corrections" and the smart will figure out how to ride the waves for
maximum profit. As a windsurfer, I can not resist attempting to learn with a small portion of my
portfolio.

Any comments on why Utek would be a better buy than Lam or vice-versa are appreciated.

best regards
Kirk out

Kirk Lindstrom

Editor: Personal Finance and Investing

-- posted by Kirk