US-Halbleiter EQUITY RESEARCH (Bear Stearns) - 500 Beiträge pro Seite

[shaman]

MUST READ RESEARCH REPORT!
BE: Fundamental Strength Suggests Stock Correction Overdone (1 OF 2)

09:00am EDT 9-Aug-00 Bear Stearns (Boucher C/ Wu B 415/772-2953) ADI ALTR CY M
Charles F. Boucher 415 772-2953 [e-mail] 08/09/00
Brian Wu 415-772-3028 [e-mail]

Subject: Industry Overview
Industry: Semiconductors

BEAR, STEARNS & CO. INC.
EQUITY RESEARCH


Fundamental Strength Suggests Stock Correction Overdone (PART 1 OF
2)


______________________________________________________________________________
Key Points
*** The sharp correction in chip stocks over the past few weeks (25% since the
SOX index recent high in mid-July) is overdone in our opinion. The
industry remains fundamentally strong, and the slower growth in wireless
handsets is more than adequately discounted in the stocks. We believe
investors should begin to buy semiconductor stocks now in front of a
likely second half rally.
*** We have completed a comprehensive survey of chip company management and
industry contacts. We see no evidence of fundamental weakness in the
overall semiconductor industry. Bookings continue to grow, lead times and
prices continue to firm, indicating that semiconductor supply is
tightening. We expect strong sequential revenue and earnings growth in the
second half of 2000.
*** The wireless handset market has experienced a slowdown relative to
aggressive expectations earlier in the year. We believe this has freed up
a small amount of flash memory inventory from cell phone OEMs, which is
being absorbed in an orderly way by the rest of the market. The cell phone
market is unlikely to experience extended weakness, and is too small to
derail the chip cycle in our view.
*** Rising commodity prices are driving accelerating industry revenue growth.
The June WSTS Global Billings Report showed revenue growth up by 48% on a
year-to-year basis, and we believe the comparisons will exceed 50% over
the next few months. We are boosting our industry growth estimates to 40%
for 2000, and 45% for 2001.
*** We believe the chip stocks are discounting the risk of a near-term
cyclical peak, which we believe is highly unlikely. We think a cyclical
peak is unlikely to occur before the end of 2001. As investors regain
confidence in the fundamental strength in the chip industry over the next
few weeks, we believe the stocks are likely to undergo a significant rally.

SEMICONDUCTOR INDUSTRY IS FUNDAMENTALLY SOUND
Despite the sharp correction in semiconductor stocks over the past few weeks
(25% since the SOX index reached a near-term peak on July 18), we believe
industry fundamentals remain decidedly positive. Investors are preoccupied with
the wireless handset market and the risk of a near-term peak in the
semiconductor cycle. We believe the semiconductor industry is far from a peak
in the supply-demand cycle, although it is likely moving through a mid-cycle
deceleration phase, which is not a sign of fundamental weakness, but rather the
normal difficult comparisons that occur after a lengthy period of very strong
growth.


Figure 1: Semiconductor Revenue Growth Is Accelerating Due To Rising Prices

Source: Bear Stearns, WSTS
The recent WSTS June Global Billings Report showed that the revenue 3-month
moving average grew by 48% versus the previous year, a sharp increase from the
40% comparison in May. We believe this is primarily due to overall price
firming as supply of semiconductors incrementally tightens. We believe this
effect will intensify in the coming months, as most anecdotal data points to
strong demand and worsening supply constraints for a broad variety of
components. We believe the year-to-year revenue comparison is likely to exceed
50% during the next few months, driven by seasonally strong unit demand
combined with firming prices.

Based on the extraordinary price-fueled revenue growth, we are raising our
estimates for overall semiconductor industry revenue growth to 40% for 2000,
and 45% for 2001. We are also boosting our total unit growth estimates to 28%
for 2000 and 30% for 2001. We believe we are in the middle of an
extraordinarily powerful semiconductor cycle that is driven by multiple end
markets, including communications and networking infrastructure, servers,
storage area networks, PCs, information appliances, digital consumer
electronics, and yes, even wireless handsets and infrastructure. The industry
will continue to be cyclical in nature, but we think the unit and revenue
upside in the current cycle is substantial, and most industry forecasts fail to
capture the potential growth that we believe is to come during the current
expansion.

Figure 2: Semiconductor Industry in the Midst of a Powerful Cycle

Source: Bear Stearns, WSTS

PEAK IN CAPACITY CYCLE FAR OFF
Given the fanatical fixation on the cell-phone market in recent weeks, we think
it is useful to step back and survey the broader picture in the industry.
Capacity cycles usually peak because of a combination of overspending on
capacity, excess inventory due to double ordering, and overly optimistic demand
forecasts. The most important of these factors in our opinion is the buildup of
excess wafer capacity, a consequence of aggressive capital spending during the
expansion cycle. Capital spending is in fact expected to grow by about 60% this
year, a significant amount. However, this aggressive spending growth should be
viewed in the context of being the first year of substantial capital spending
growth after 4 consecutive years of little or negative growth.

We believe the semiconductor industry today is faced with serious supply
shortages of many components, and the near term outlook is not encouraging.
Companies are investing aggressively in wafer capacity to correct the current
supply deficiencies. The rate of capacity growth in the near term will be
limited by semiconductor equipment companies` ability to ship equipment, which
is evident today by lengthening equipment lead times. We do not believe the
semiconductor industry can build capacity fast enough to cause the cycle to
peak while demand is healthy. In our view, it would take an unexpected downturn
in demand to cause the industry cycle to peak prematurely, which we think is
very unlikely. While we have the utmost confidence in the chip industry`s
ability to over invest and plunge itself into another cyclical downturn, we
believe that point is unlikely to occur before the end of 2001, and could occur
even later.

SECOND DERIVATIVE EFFECTS
The unit and revenue growth rate graph in Figure 1 shows that the unit growth
rate formed a peak in February 2000, and the revenue growth rate seems to be
heading toward a peak near the end of 2000. The decelerating growth rate or
negative second derivative is a negative factor for growth stocks like the
semiconductor universe. We think the recent weakness in the stocks and concerns
over a near-term cyclical peak is partly related to the negative second
derivative of the growth rate. However, we do not think the growth rate peak is
associated with negative fundamental signs such as declining lead times,
falling prices, or order cancellations. Rather, we think the industry is moving
through a mid-cycle deceleration analogous to 1994, when the industry
experienced a similar pattern. The decline in growth rate is a natural
occurrence following a period of very strong growth as year-to-year comparisons
become temporarily more difficult. We believe that both unit and revenue growth
rates are likely to reaccelerate in 2001, with revenue growth outstripping unit
growth by a substantial margin. The stocks are discounting the possibility of a
near-term peak in the capacity cycle, resulting in relatively attractive
valuation levels.

IMPACT OF THE WIRELESS HANDSET MARKET
The catalyst for the risk of a premature peak in the semiconductor cycle has
been the wireless handset market, which has undergone a radical transition in
perception from a source of unbridled growth to a demand inhibitor, possibly
capable of triggering a broad correction in the overall semiconductor market.
We believe this risk is significantly overblown. First, we do not believe the
wireless handset market has weakened substantially - rather, we think the
aggressive upside expectations to the nominal handset unit estimates of about
425 million units for 2000 have been essentially eliminated. We believe that
the wireless handset market is on track to grow by about 60% in 2000 to about
425 million units, and estimate will grow by 30-35% in 2001 to 550-575 million
total units.

Second, we do not believe the wireless handset market is large enough to cause
the semiconductor supply tightness to reverse itself. A 425 million unit
handset market with an average semiconductor content of about $40-$45 per
handset (our estimate) represents about 8-9% of the total semiconductor market
in 2000 on a revenue basis, significantly smaller than the PC market in 1995,
which exceeded 40% of the total semiconductor market and directly contributed
to the last peak in the capacity cycle.

We do think that some wireless handset OEMs likely accumulated inventory of
flash memory and capacitors, the 2 most difficult components to procure, in
anticipation of upside to the nominal handset unit forecasts. It is likely that
some of this inventory is being liquidated as a result of the adjustment in
handset unit expectations back to the nominal industry estimates. However, the
relatively small size of the wireless handset market and the strong demand for
these products across the rest of the industry should allow whatever modest
inventory liquidation occurs from the cellular handset vendors to be absorbed
in an orderly fashion without causing a sudden shift from supply shortage to
supply glut.

CHANNEL CHECKS ARE UNIFORMLY POSITIVE
We have spoken to a number of industry sources and many different semiconductor
management teams in the last week. We see virtually no evidence of eroding
fundamentals in the industry, and continue to see abundant evidence of ongoing
supply shortages. Semiconductor categories that are experiencing strong growth
and tightening supply include analog components, microcontrollers, DSPs, ASICs,
standard logic, SRAM, and DRAM. The distribution channel reports more products
going on allocation, and increasing expedite activity to find product for
customers.

Growth in the broadband infrastructure and optical network and switching
markets remains very strong, and current growth estimates may be conservative.
Enterprise LAN growth appears to be strengthening as Gigabit Ethernet
deployments accelerate. The growth in Internet and e-business networks is very
strong, driving demand for servers, storage systems, and networking equipment.
The PC market is showing signs of normal seasonal strength as we move toward
the fall and winter selling seasons. Digital consumer products and information
appliances are adding to demand, and economically sensitive baseline sectors
like industrial and automotive remain very healthy.

We believe demand for semiconductors remains strong, and component availability
is a growing concern for most OEMs and contract manufacturers. Our primary
research supports this outlook, and we see little near term risk from either
the supply or demand standpoint that threatens this outlook.
First Call Corporation, a Thomson Financial company.
All rights reserved. 888.558.2500

Aug-09-2000 12:01 GMT
Symbols:
US;ADI US;ALTR US;CY US;LSCC US;MU US;NSM US;TXN GB;ADI0N GB;ALTR0N
GB;MU0N GB;NSM0N GB;NWFX GB;TXN0N US;MUZ
Source FC First Call Research Notes
Categories:
BKR/BE FCIN/SEMICO FCIN/COMPUT FCSU/IND GEO/US GEO/NME

[shaman]

PART 2 OF MUST READ RESEARCH REPORT
BE: Fundamental Strength Suggests Stock Correction Overdone (2 OF 2)

09:00am EDT 9-Aug-00 Bear Stearns (Boucher C/ Wu B 415/772-2953) ADI ALTR CY M
(PART 2 OF 2)
STOCK VALUATIONS OVERSTATE NEAR-TERM RISK
We believe the recent correction in the chip stocks has reached a point where
valuations are discounting the risk of a significant slowdown in the
semiconductor industry, which we think, is unlikely. The semiconductor stocks
are trading at an attractive valuation relative to the fundamental strength of
the current expansion cycle. The peak relative forward P/E multiple the
semiconductor stocks attained in the last cycle versus the S&P 500 was about
50%, while the relative premium today is only about 10% (excluding the highly
valued pure play communications IC companies). We believe that as investors
regain confidence in the semiconductor expansion cycle, and the upside
potential of the companies in the second half of 2000, the stocks could
experience a strong rally later in the fall.

We think the best investment ideas are stocks that have undergone excessive
corrections that have maintained fundamental strength. Our best ideas are
Altera (ALTR-Buy, Target Price: $200), Analog Devices (ADI-Buy, Target Price:
$115), Cypress Semiconductor (CY-Buy, Target Price: $75), Lattice Semiconductor
(LSCC-Buy, Target Price: $120), Micron Technology (MU-Buy, Target Price: $140),
National Semiconductor (NSM-Buy, Target Price: $115), and Texas Instruments
(TXN-Buy, Target Price: $100).

Most of these stocks, with the exception of Altera, Lattice, and Micron have
been sold off because of their exposure to the wireless handset market. In the
case of Analog Devices, Cypress, and National, their exposure is in the 20-25%
of revenue range, and the devices supplied are not specific to the wireless
handset. This means that even if demand from handset customers were to slow,
the product could be reallocated to customers in other markets that are
demanding more product. We believe this is in fact the case in the analog and
SRAM markets, and we believe there is little risk to earnings or future growth
for Analog Devices, Cypress, or National. Texas Instruments does have some
exposure for handset specific DSP baseband processors, but we believe little
risk exists for these products. The overall strength the company is seeing in
its catalog DSP, catalog analog, SPARC microprocessor, and standard logic
businesses should more than offset any risk to wireless handset DSP sales.

Altera and Lattice continue to experience very strong demand for their
programmable logic products, which we believe stems from an overall
acceleration in demand for PLDs driven by intensifying time-to-market pressure
on system designers, and the strength in the communications and networking
markets, which accounts for about two-thirds of total revenue for the
companies. The correction in these stocks is totally unwarranted in our
opinion.

Micron is the epitome of the commodity semiconductor company. However, that
commodity, DRAM, is in very tight supply, and we think it is likely to get
tighter during the rest of the year. DRAM demand is being driven by the
seasonally strong PC market, increased memory configuration per box, and new
digital consumer and appliance markets. Contract prices are currently at $8.00,
and we expect prices to continue to rise during the next few months. This
should lead to strong performance for Micron shares.

In summary, we strongly believe the semiconductor cycle is intact, a view that
is supported by recent market and channel data. The stocks have corrected
substantially, and we believe their current valuation substantially overstates
the near-term risk to earnings for the semiconductor universe. We expect
strengthening fundamentals to spark a significant rally in the stocks this fall
and we would be buyers of the semiconductor stocks today in front of this
potential rally.

Companies Mentioned:
Analog Devices (ADI)
Altera* (ALTR)
Cypress Semiconductor (CY)
Lattice Semiconductor* (LSCC)
Micron Technology (MU)
National Semiconductor (NSM)
Texas Instruments* (TXN)

MU, TXN- Bear, Stearns & Co. is associated with the specialist in the
stock or options of this company. That specialist (a) makes a market
in the security; (b) may have a long or short position in the security;
and (c) may be on the opposite side of public orders executed on the
floor of the Exchange.

Bear, Stearns & Co. and others associated with it may make
markets in, have long or short positions in and effect transactions
in securities of companies mentioned in this note.
______________________________________________________________________________
* Specialist Bear, Stearns & Co. is associated with the specialist in the stock
or options of this company. That specialist (a) makes a market in the
security; (b) may have a long or short position in the security; and (c) may be
on the opposite side of public orders executed on the floor of the Exchange.
First Call Corporation, a Thomson Financial company.
All rights reserved. 888.558.2500

Aug-09-2000 12:01 GMT
Symbols:
US;ADI US;ALTR US;CY US;LSCC US;MU US;NSM US;TXN GB;ADI0N GB;ALTR0N
GB;MU0N GB;NSM0N GB;NWFX GB;TXN0N US;MUZ
Source FC First Call Research Notes
Categories:
BKR/BE FCIN/SEMICO FCIN/COMPUT FCSU/IND GEO/US GEO/NME

[Frenkes]

aaaaaaahhhhhhhhhh -
haste auch ne deutsche kurzfassung??

[shaman]

sorry frenkes, hab leider keine deutsche kurzfassung.

aber hier sind die kursziele:

We think the best investment ideas are stocks that have undergone excessive
corrections that have maintained fundamental strength. Our best ideas are
Altera (ALTR-Buy, Target Price: $200), Analog Devices (ADI-Buy, Target Price:
$115), Cypress Semiconductor (CY-Buy, Target Price: $75), Lattice Semiconductor
(LSCC-Buy, Target Price: $120), Micron Technology (MU-Buy, Target Price: $140),
National Semiconductor (NSM-Buy, Target Price: $115), and Texas Instruments
(TXN-Buy, Target Price: $100).

Mein favorit ist ANALOG DEVICES.
gute nacht

[tschakawaka]

Meine Favoriten von den aufgezählten sind:

speziell diese, wegen der starken Unterbewertung:

MICRON TECHNOLOGY

& NATIONAL SEMICONDUCTOR

NSM halt´ich auch selber!!!

cu tschaki

[tschakawaka]

Ach ja, man sollte hier noch APPLIED MATERIALS dazu geben, die haben wieder mal die Erwartungen geschlagen!!!

Dies könnte dem $SOX einen netten Schub heute geben

Applied Materials Inc

hat gestern gemeldent, den Gewinn je Aktie aus gewöhnlicher Geschäftstätigkeit vor Sonderposten im 3. Quartal 2000 auf 70 Cent gegenüber 30 Cent im Vorjahreszeitraum gesteigert zu haben. Der Netto-Umsatz ist um 83% auf 2,732 Mrd. USD gegen 1,49 Mrd. USD im Vorjahr gestiegen.

Der Ausblick sei weiter positiv, sagte Chief Executive Officer James Morgan. Das Unternehmen meldete ein gebuchtes operativen Einkommen (posted operating income) von 826,239 Mio. USD im Vergleich zu 330,109 Mio im Vorjahreszeitraum.

Die Zahl der Neuaufträge stieg um 116 Prozent auf 3,28 Mrd. USD (1,51 Mrd. USD), die Bruttohandelsspanne stieg auf 50,9% (48%).

WOW, sehr schön...

Das KGV 2001 beträgt ca. 21

Weiteres folgt im nächten Posting...

cu tschaki

p.s. mein LAPTOP sauft vielleicht gleich ab - das ist der Grund
es ist einer von IPC ARCHTEC - ich halte zwar nicht deren Aktien, dafür stürzt mir deren Computer laufend ab; na ja, Bill Gates wird auch nicht ganz unschuldig dran sein ;-)

[tschakawaka]

AMAT könnte dem Philadelphia Semiconductor Index einen schönen Schub geben; leider kann man hier keine "DOLLAR-Zeichen" eingeben, sonst hättet Ihr oben das Kürzel sehen können!!!

Also, voila:



Hier kann man schön sehen, wie sich der Halbleiter-Index wieder brav über den SMA 200 geschlängelt hat...

um sich wieder alten Höhen zu widmen ?!?

wer weiss, vielleicht ist es aber auch erst Ende September soweit?!?

cu tschaki