Morgan Cuts Chip Equip Rating, Cites 'Lofty' Valuations
By: Donna Fuscaldo, Of DOW JONES NEWSWIRES
biz.yahoo.com
NEW YORK -(Dow Jones)- Although Morgan Stanley Dean Witter analyst Steven Pelayo expects most chip equipment companies to meet, and even beat, earnings estimates for the current quarter, he cut his investment rating on a handful of stocks because of their "lofty" valuations."
"Using price-to-sales ratios, semiconductor equipment valuations are near previous cyclical peaks," wrote the analyst in a research report Wednesday. " Furthermore, adjusting for SAB 101 accounting, price-to-sales ratios are actually above previous peaks"
Pelayo, who maintained his strong buy rating on Applied Materials (NasdaqNM: AMAT - news) Inc. (AMAT), ASML Holding NV (ASML) and Cymer Inc. (CYMI), downgraded Axcelis Technologies (NasdaqNM: ACLS - news) Inc. (ACLS), KLA-Tencor Corp. (NasdaqNM: KLAC - news) (KLAC), Lam Research Corp. (LRCX), LTX Corp. ( LTXX), Novellus Systems (NasdaqNM: NVLS - news) Inc. (NVLS), Teradyne Inc. (NYSE: TER - news) (TER), and Varian Semiconductor Equipment Associates Inc. (VSEA) to outperform from buy ratings. |
