NEW YORK (TheStreet) -- Citigroup added KLA-Tencor (KLAC) - Get Free Report to its Focus List and set an $82 price target. The firm said the company is best positioned to benefit from higher foundry investment in the second half of the year.
The stock closed at $69.44 on Tuesday.
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Separately, TheStreet Ratings team rates KLA-TENCOR CORP as a "buy" with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate KLA-TENCOR CORP (KLAC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 3.1%. Since the same quarter one year prior, revenues rose by 14.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- KLAC's debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 4.04, which clearly demonstrates the ability to cover short-term cash needs.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The gross profit margin for KLA-TENCOR CORP is rather high; currently it is at 61.25%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 24.48% is above that of the industry average.
- You can view the full analysis from the report here: KLAC Ratings Report
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.