Salomon Keeps Applied Material Rating

Analyst Glen Yeung says he already expected a pullback in the chip equipment group

Salomon Smith Barney keeps its rating on Applied Material (AMAT ).

Analyst Glenn Yeung says he's been saying that from a trading perspective, these stocks are likely to pull back given their recent run. That said, Yeung sees nothing on the fundamental horizon to change his long-term view: 1) tech-oriented buys will support us into the third quarter and fourth quarter of this year; 2) capacity-oriented buys will start to pick up in the beginning of 2003 as the economy recovers.

Yeung notes it is his firm's underlying view that the economy recovers next year. His favorites in the group: Applied Materials and Novellus (NVLS )

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