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Citi Upgrades Credence Systems (CMOS) to Hold

June 24, 2008 7:47 AM EDT
CMOS Hot Sheet
Rating Summary:
    0 Buy, 0 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 25 | Down: 12 | New: 36
Citi upgrades Credence Systems (Nasdaq: CMOS) from Sell to Hold.

Citi analyst says, "We are upgrading CMOS from Sell to Hold and raising our target to $1.25 based solely on the pending merger with LTX Corp (Nasdaq: LTXX). While we think this deal has a strong likelihood of being completed, we can see a reasonable scenario where LTXX continues to trade lower into deal closure given what appears to be an asset and cost purchase with little growth catalysts. We apply the proposed exchange ratio of ~0.6x to what we believe to be downside for LTXX shares ($2/share on~1.2x tangible book) to arrive at our new $1.25 target for CMOS. There are no changes to our model."

Citi maintains 'Buy' rating on LTXX. Price target lowered from $5 to $4.

Credence Systems Corporation is a provider of test of automated test equipment (ATE) solutions for a range of semiconductor companies.

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