MKS Instruments Analyst Slashes Price Target By 10% On WFE Spending Headwinds

  • Needham analyst James Ricchiuti maintained MKS Instruments, Inc MKSI with a Buy and cut the price target from $105 to $95.
  • With growing signs of a deepening WFE spending downturn in 2023, he again reduced estimates for MKS, which will report Q3'22 results after the market close on November 2. 
  • In late September, he issued revised estimates for MKS, including the recently acquired Atotech business and a tempered outlook for the legacy MKS business. 
  • Since that time, there have been several negative data points, including a preannouncement from Applied Materials, Inc AMAT and a weak 2023 WFE outlook from Lam Research Corp LRCX, both large customers of MKS, along with reports of reduced semi cap-ex from leading semi companies
  • The deteriorating WFE outlook comes at a time of new U.S. export restrictions for U.S. WFE and related parts and services sold in China. 
  • He re-rated MKS as shares have likely troughed in anticipation of reductions in Street estimates.
  • Price Action: MKSI shares traded higher by 0.04% at $77.66 on the last check Friday.
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