UPDATE: Nomura Downgrades Linear Technology to Neutral on Valuation

Nomura lowered its rating on Linear Technology

from Buy to Neutral and reduced its price target from $34 to $29. Nomura commented, "Linear has been a good stock over the past six months, outperforming the SOX by 12 points based on its variable cost structure, high ROIC and 3% dividend yield. Despite weak December guidance (down 5-10% QoQ), a snapback in sales is not on the horizon owing to weaker end-demand as it will be limited by unchanged channel inventories exiting December. We believe the stock is expensive at 18x our revised CY13 estimate, vs a three-year average of 15x." Linear Technology closed at $32.22 on Wednesday.