Are they savvy or are they suckers?

Investors betting on surprisingly good fourth-quarter earnings and sales figures from Applied Materials Inc. pushed the stock up more than $2.00 per share Thursday in heavy, late-afternoon trading.

First Call consensus expects the world's largest chip-equipment manufacturer to post a profit of 46 cents per share on sales of about $1.2 billion shortly after the market closes.

Such optimism in the face of unstable Asian currency markets and a declining book-to-bill ratio for equipment orders in October may seem unfounded, especially after watching the majority of equipment makers' stocks go in the tank for the past month.

Worse yet, the plunging stock prices for the likes of Novellus Systems Inc., Lam Research Corp., and KLA-Tencor Corp. came after they reported decent third-quarter results.

So what makes Applied's story so different?

"First of all, exactly what impact currencies in Asia will have on this market is unclear," said Jay Deanha, an analyst at Morgan Stanley Dean Witter. "If it does get ugly, you'll see a dramatic impact on Applied and others in this segment. But it's far too early to jump to that conclusion."

Deanha still maintains his "strong buy" rating on the stock and expects it to post a profit close to $175 million for the quarter.

Another quirky fact working in Applied's favor is its quarterly reporting schedule. Unlike the vast majority of semiconductor and chip-equipment firms, Applied's fourth quarter ends in October instead of September. That extra quarter, coming at a time when chip production is in high gear for the Christmas shopping season, gives it a little bit more clout and perhaps inflated figures for the quarter.

"And since Applied reports later than the others, its bookings and billings aren't totally factored in to the October book-to-bill statistics," Deanha said. "Applied is the biggest of the bunch, so its totals will have a huge impact on how these stocks will be perceived going forward."

Still, the chaotic markets in Hong Kong, Japan, and other outposts in Asia have chased away some investors. Their fears might be valid considering the Dow had its 554-point collapse in late October just hours after Hong Kong's Hang Seng index plummeted 8 percent in a single day of trading.

No stocks are hurt more by crumbling economies in Asia than technology. If currency values sink, so does the buying power of Asian companies. A price war would inevitably ensue, eroding profit margins and devastating stocks.

But that's not all.

The North American semiconductor equipment industry posted a preliminary book-to-bill ratio of 1.06 for October 1997, reported Semiconductor Equipment and Materials International on Wednesday.

Three-month average shipments declined slightly in October 1997 to $1.5 billion. The figure is 5 percent below the September 1997 level, but 44 percent above the October 1996 level. Three-month average bookings decreased in October 1997 to $1.6 billion. The bookings figure declined 8 percent below the September 1997 level, but is 97 percent above the October 1996 level.

"It is not unusual for shipments and bookings to slow a bit in the fourth quarter," said Dick Greene, principal analyst with SEMI. "What is important is that current order levels for front-end equipment have nearly doubled in the past 12 months."

That's all well and good, but on Wall Street, companies with merely solid, steady growth can get punished.

Novellus Systems Inc. shares were trading at a 52-week high of $64.68 per share in October, just a few weeks before the company reported its third-quarter results. After posting a profit of $20 million, or 57 cents per share, on sales of $155, investors weren't impressed. The stock has since gone straight down to $46.31 per share as of Thursday afternoon.

Same story at KLA-Tencor Corp. Trading near its 52-week high of $75.63 in early October, the stock collapsed after the company posted a profit of $50 million, or 56 cents per share, on sales of $312 million in its third quarter. In afternoon trading Thursday, the stock was up $1.62 per share to $47.25.

"If Applied can blow away the numbers for this quarter, you'll see all these stocks make a strong rebound," said Joe Moore, an analyst at Goldman Sachs. "But if they just barely meet or fall short of the First Call figure, that whole segment will be a very hard sell."