IIVI - II-VI downgraded at Citi amid underperformance ahead of closing Coherence deal

MJ_Prototype/iStock via Getty Images Expecting the stock to continue trading sideways until the Coherent acquisition is closed, Citi downgrades II-VI (IIVI) from Buy to Neutral. "We do not expect meaningful share price expansion until after the deal is closed and synergies are realized, similar to the trajectory the stock took after the acquisition of Finisar in 2019," writes analyst Amanda Scarnati. The II-VI downgrade comes as Citi updates its rankings of semi materials and equipment component stocks heading into earnings season. Scarnati says the firm "continues to prefer materials suppliers over equipment component suppliers" in the semiconductor space since utilization rates are expected to remain strong through next year. Materials intensity is also continuing to rise while "equipment expectations are largely priced in." Citi continues to favor Entegris (ENTG) for its high-quality materials growth driven by increased industry use of filtration and purification. The firm models 18.5% top-line growth for

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II-VI downgraded at Citi amid underperformance ahead of closing Coherence deal