from Briefing.com:
CYMER INC. (CYMI) 25 15/16 -4 1/16. The troubles continue for this semiconductor equipment maker as six months after
Morgan Stanley upgraded the stock from an "outperform" to a "strong buy," the firm has reversed course and has cut its rating
to a "neutral." Meanwhile, in about one month, the value of this excimer laser maker has been cut almost in half after trading
at a high of $48 1/2 in late August, on a split adjusted basis. The news that Morgan Stanley, a major bull on Cymer had
withdrawn support for the stock has hit the issue hard today, although Cymer had been losing steam for the past several weeks
on concerns that it was having problems with its lasers and that it was leading to contract cancellations. While Cymer has
always denied that it had a problem with its lasers, along with investors, Wall Street has started to back away from the issue with
Montgomery Securities downgrading the stock to a "hold" from a "buy" earlier this week. Along with the ratings cut, Morgan has
also lowers 1997 and 1998 EPS estimate to $0.76 and $1.00 a share, respectively from its previous forecast of $0.84 and
$1.15 a share as it expects the company to ship less laser units than previously. In keeping with earnings reduction, the firm also
cut its price target to $30 from $46, meaning that this issue has little upside target given that Cymer was trading at $30 when
Morgan lowered its view on the stock. Given the price erosion and revised estimates, the stock's multiple has been cut from 58
times earnings to 34 based on Morgan's 1998 earnings estimates. |
