Analyst Actions: Semiconductors, SBC, Union Pacific, NBCi
Hold yer guns there, pardner. Don't be a-goin' into dem chips, ya hear?
Credit Suisse First Boston
analyst John Pitzer made some notes about the semiconductor equipment industry, telling investors that now is not the time to snap up those battered semiconductors. In a note to investors this morning, the analyst wrote, in all capital letters, no less: "We continue to believe that a better buying opportunity will present itself in
the first quarter of 2001."
Pitzer said that although changes in the Fed bias and rate picture seem imminent, this sector won't really be affected. Put simply, semiconductors will gain no solace if the Fed makes changes. This industry is still bound by the fundamental laws of supply and demand. And right now, demand seems to be abating as capital spending in the semiconductor industry declines.
"We have been cautioning that the semiconductor industry was in the midst of a inventory correction, the depth and breadth of which was perhaps more severe than most realized," he wrote. "The impact of this inventory correction would be a dramatic reduction in capital budgets for capacity addition in 2001, especially
the first half of 2001."
In plain English, don't look for the picture to change until mid-2001, since inventory levels are still quite high.
Upgrades
Union Pacific
(UNP) - Get Report
: UP to buy from neutral at
Salomon Smith Barney
.
Downgrades
ACNielsen
(ART)
: DOWN to hold from strong buy at
ING Barings
.
SBC Communications
(SBC)
: DOWN to accumulate from buy at
Merrill Lynch
.
Terayon
(TERN)
: DOWN to neutral at
W.R. Hambrecht
.
Initiations
Alliance Forest Products
(PFA)
: NEW neutral at Solomon Smith Barney.
American Home Products
(AHP)
: NEW buy at Credit Suisse First Boston.
Fiserv
(FISV) - Get Report
: NEW hold at CSFB.
Forward Air
(AHP)
: NEW buy at CSFB.
GoTo.com
(GOTO)
: NEW accumulate at
Prudential Securities
; price target: $10.
Intermagnetics General
(IMG)
: NEW attractive at
Robertson Stevens
.
NBCi
(NBCI)
: NEW hold at Prudential Securities; price target: $5.
New Skies Satellite
(NSK)
: NEW buy at ING Barings; price target: $13.
StorageNetworks
(STOR) - Get Report
: NEW attractive at Robertson Stevens.
Tempec
(TBC) - Get Report
: NEW buy at Solomon Smith Barney.
Group Moves
Lehman Brothers
initiated coverage on a handful of paper companies, starting them all at buy. In its recommendation to investors, it wrote: "Shares of paper companies have endured the worst bear markets vs. the
S&P 500 since the Great Depression." It recommended an overweight position in the following companies:
- Georgia-Pacific (GP) Louisiana-Pacific (LPX) - Get ReportMead (MEA) Sappi Limited (SPP) Weyerhaeuser (WY) - Get Report
