A new research report by Susquhanna Financial has upgraded estimates on chip equipment (NYSE:SMH) makers Novellus (NASDAQ:NVLS), Lam Research (NASDAQ:LRCX), ASML (NASDAQ:ASML) and KLA-Tencor (NASDAQ:KLAC). The firm noted the sector’s stocks are trading “around trough valuation,” and that it’s time for investors to come back to the sector.
In the research note by Susquehanna analyst Mehdi Hosseini, he noted:
“We expect semi manufacturing utilization rates to bottom out by the spring of 2012, and start improving by summer, thus driving up [semiconductor equipment] bookings by mid-year following a bottoming early in the year,” he writes. “Although there remains downside risk to the current consensus estimates, we believe the current share prices (with valuation near a book-based trough) have already dialed in most of it.