North Coast Solar Stocks

September 21, 2009

Applied Materials shares decline after analyst downgrades to ‘Average’

Filed under: AMAT — Tags: , , , , — Jason @ 12:23 pm

Monday September 21, 2009, 12:23 pm EDT

SAN FRANCISCO (AP) — Applied Materials Inc. (AMAT) shares declined Monday after a Caris & Co. analyst downgraded the stock to “Average,” saying management changes indicate it is having trouble gaining share in the semiconductor equipment market.

Shares of Applied Materials, which makes equipment for the production of semiconductors, fell 45 cents, or 3.5 percent, to $12.58.

In a note to investors Monday, Caris analyst Ben Pang lowered his rating from “Buy” and cut his price target by $2 to $14.

Pang said the company’s recently announced management reorganization, which included Randhir Thakur replacing Tom St. Dennis as head of the silicon systems group, indicate “poor market share for semi equipment.”

“We think this could cause revenues to rebound slower than expected because semi capital spending is the key growth avenue over the next several quarters,” he said.

He believes the company is having trouble gaining share in the etch and process diagnostics market segments specifically.

“Historically, AMAT has used the downturns to gain share, but we see scant evidence of this during the current downturn,” he added.

Meanwhile, Goldman Sachs analyst James Covello wrote in a Sunday client note that while the company is getting customers to sign off on its SunFab lines, the market is still “extremely skeptical” of Applied Materials’ chances to succeed long term in the thin-film solar market.

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