Goldman Sachs Downgrades KLA-Tencor (KLAC) to Sell, Sees 14% Downside

Goldman Sachs downgraded KLA-Tencor (NASDAQ: KLAC) from Neutral to Sell and cuts their price target from $43 to $37, suggesting 14% downside.

The firm said their estimate that foundry capex will be down 30% year-over-year and Intel's (Nasdaq: INTC) capex to decline 44% year-over-year "will have an outsized impact on KLA's orders, and in turn the stock."

Foundries represented 72% of KLA's orders in 4QCY10 and 58% in 1QCY11, and Intel is historically a 10%+ customer, Goldman noted.

For more ratings news on KLA-Tencor click here and for the rating history of KLA-Tencor click here.

Shares of KLA-Tencor closed at $42.83 yesterday.

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