- Susquehanna downgrades semi-cap stocks after checks signal incremental weakness for cloud and enterprise spending expectations in 1H19.
- Analyst Mehdi Hosseini says what was seen as a “digestion period” for spending now looks more alarming with IT budget freezes and increasing executive caution at global cloud providers.
- The analyst expects bottoming server builds in Cloud and Enterprise in 2H9, up to three quarters later than the prior expectation.
- Semi-cap downgrades: AMAT (NASDAQ:AMAT) target drops from $60 to $38, ASML (NASDAQ:ASML) from $240 to $200, and Lam Research (NASDAQ:LRCX) goes from Positive to Neutral with a target cut from $225 to $165.
- Source: Bloomberg First Word.
- AMAT trades down 4% premarket to $32.20. ASML is down 5.2% to $167.23 in part due to European tech weakness. Lam Research is down 3.3% to $139.50.
- Previously: ASML, SAP drop on European tech sector stumble (Oct. 23)