Semiconductor b2b

Just one small segment of conventional analysis NFTRH 331 found itself doing…

Semiconductor Sector

Folks, it is b2b (book-to-bill) time again and the reading for January came in at 1.03, which represents growth from the December reading. But the b2b bears discussion.

b2b

Last month we noted that the lower number (.99) was really not bad because it was the product of ramped up billings, while bookings (the important figure) increased. This month the b2b increased while bookings declined. This was due to a tail off in billings. Overall, the b2b continues to be stable to healthy.

Reading too much into one or two month periods is like chasing our tail, so we’ll await the February data and see if the bounce (to the previous downward trend) was a year-end shipments phenomenon (spilling into January) or if growth looks to continue unabated in the Semi sector as SEMI projects…

“2014 was a strong growth year for the semiconductor equipment industry, and both bookings and billings at the start of this year are comparable to the early 2014 figures,” said SEMI president and CEO Denny McGuirk. “Given the positive outlook for the semiconductor industry in 2015 and based on current capex announcements, we expect the equipment market to continue to grow this year.”

For our purposes, the next target on the SOX index is 750 and I continue to hold some items, headlined by Intel. This sector continues to be a Canary in the US economic Coal Mine and it is still happily chirping.

While other areas of the economy look strained it is difficult to project anything serious until this leading edge to the economy starts to decelerate.

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