- Morgan Stanley (NYSE:MS) downgrades the semiconductor industry from in line to cautious due to chip inventory levels.
- Analyst Joseph Moore says the sector is “showing signs of overheating."
- Moore: “Cyclical indicators are flashing red and any contraction in lead times and/or demand slowdown could lead to a significant inventory correction. Further, elevated inventory and stretched lead times have no margin for error as any lead time adjustment or demand slowdown could drive a meaningful correction. Risk/reward is the poorest it has been in 3 years.”
- Semi equipment stocks that could move on the news: ASML (ASML), KLA-Tencor (KLAC -0.7%), Ichor (ICHR -2.8%), Lam Research (LRCX -3.4%), Ultra Clean Holdings (UCTT -2.1%), Brooks Automation (BRKS -0.8%), AXT (AXTI -0.3%), Nanometrics (NANO +0.5%), Nova Measuring Instruments (NVMI -0.3%), Axcelis Technologies (ACLS -0.9%), Ambarella (AMBA +0.1%), Universal Display (OLED -0.1%), Synopsys (SNPS +0.9%), and Teradyne (TER -1.5%).
- More potential chip movers: Intel (INTC +0.1%), Nvidia (NVDA -0.5%), STMicroelectronics (STM -0.2%), Xilinx (XLNX -0.2%), ASML (ASML), Micron (MU -2.5%), Analog Devices (ADI -0.2%), Cirrus Logic (CRUS -0.8%), Cypress Semiconductor (CY -0.9%).
- Related ETFs: SOXL, SOXX, SMH, USD, PSI, XSD, SOXS, SSG, FTXL, XTH
- Previously: AMAT down 2.2% on Morgan Stanley downgrade (Aug. 9)
- Previously: Morgan Stanley downgrades ON Semiconductor (Aug. 9)
- Now read: Financial Exchange Stock Talk: Mark Hibben On Qualcomm (NASDAQ:QCOM) And Intel
Original article