Needham & Company Cuts Price Target to $20 Following Newport Corp's (NEWP) Q2 Preannouncement

Needham & Company reiterated a Buy rating on Newport Corp. (NASDAQ: NEWP), and cut the price target to $20.00 (from $24.00), following a 2Q preannouncement. Management warned that revenue would be 4-9% below guidance, and EPS would likely be 32-34% below consensus. NEWP is scheduled to report full Q2 results after the close on August 4th.

Analyst James Ricchiuti commented, "Prior to the open yesterday, NEWP warned that Q2 rev would be 4-9% below guidance, with EPS likely to be 32-34% below consensus. Mgmt did not provide guidance on bookings or details regarding any verticals, but we believe weakness may have come from the semi-cap and scientific research markets, the latter including a loss of $0.02/share from the small Femtolaser business acquired in Q1. While we can't rule out more broad-based market weakness, mgmt expects 2H rev and non-GAAP net income to be better than 1H, albeit now measured off a much lower bar. Yesterday's sell-off appears overdone, even after taking numbers down for 2H and 2016. We're maintaining our Buy, though we acknowledge that the Q2 miss feeds into doubts investors have had (and will likely continue to have) about growth and operating leverage going forward."

For an analyst ratings summary and ratings history on Newport Corp. click here. For more ratings news on Newport Corp. click here.

Shares of Newport Corp. closed at $15.99 yesterday.

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