UPDATE: J.P. Morgan Downgrades Rubicon Technology to Neutral, Reiterates $7 PT on Valuation

In a report published Wednesday, J.P. Morgan analyst Paul Coster downgraded the rating on

from Overweight to Neutral, but reiterated the $7.00 price target. In the report, J.P. Morgan noted, “We are downgrading RBCN to Neutral on Valuation. The stock is up 35% YTD versus ~11.3% increase in the S&P 500 index, and has traded through our price target. General Lighting is driving a recovery in demand for LEDs and sapphire substrate, which should drive a recovery in RBCN sales and gross margins; however, we believe this recovery is largely priced in now. Some sapphire production capacity has been withdrawn from the market, but suppliers can ramp production quickly and we see only a slow recovery in margins at this time. Price target $7.00.” Rubicon Technology closed on Tuesday at $8.27.