CAMT - BofA upgrades Camtek cuts Coherent MACOM Technology Lumentum

2023-07-18 07:50:22 ET

Investment firm Bank of America made a number of ratings changes in the semiconductor space on Tuesday, upgrading Camtek ( NASDAQ: CAMT ) and downgrading Coherent ( NYSE: COHR ), MACOM Technology ( NASDAQ: MTSI ) and Lumentum ( NASDAQ: LITE ) for varying reasons.

Analyst Vivek Arya raises his rating on Camtek ( CAMT ) to buy from neutral and boosted the per-share price target to $50 from $30, noting that the company is benefiting from increased advanced packaging penetration (roughly 60% of sales) and continued "outgrowth" in wafer fab equipment, especially compound semiconductors, which makes up roughly 15% of sales.

"Given increased exposure to the above growth markets, we see potential for multiple re-rating toward larger front-end peers," Arya wrote in an investor note.

Camtek ( CAMT ) shares rose 1.4% in pre-market trading.

Conversely, Arya downgraded Coherent ( COHR ) and MACOM Technology ( MTSI ) to neutral and Lumentum ( LITE ) to underperform, noting "sluggish" telecom spending, stretched valuations and "overstated" benefits from artificial intelligence.

Coherent ( COHR ), MACOM Technology ( MTSI ) and Lumentum ( LITE ) shares fell 3.9%, 1.5% and 5% , respectively, in pre-market trading.

Aside from the ratings changes, Arya added Marvell Technology ( MRVL ) to the firm's US 1 list and removed Global Foundries ( GFS ) from the list.

He also raised his estimates on Nvidia ( NVDA ), as he now sees the firm earning $11.05 per share in 2024, up from a prior view of $10.01 per share. He also boosted his price targets on Nvidia ( NVDA ), Marvell ( MRVL ) and ON ( ON ), to $550, $80 and $120, up from $500, $75 and $110, respectively.

Analysts are largely cautious on Camtek ( CAMT ). It has a HOLD rating from Seeking Alpha authors , while Wall Street analysts rate it a BUY . Conversely, Seeking Alpha's quant system, which consistently beats the market, rates CAMT a HOLD .

More on semiconductors

• B. Riley upgrades Cohu, tweaks estimates on chip equipment makers
• Barclays upgrades Coherent, downgrades Lumentum on varying outlooks
• Coherent slumps on China AI concerns, B. Riley downgrade

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