Micron, KLA stocks downgraded at Deutsche Bank

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Shares of Micron Technology Inc. MU, -1.33% and KLA Corp. KLAC, -1.39% were each off more than 1% in Monday morning trading after Deutsche Bank analyst Sidney Ho downgraded them to hold from buy. “We are incrementally more cautious on the memory market, as we believe the current downturn will last longer and be more severe than we previously forecasted,” Ho wrote in his note to clients about Micron. “On the demand side, weakness in consumer PC/smartphone has now spread to the enterprise side, and even cloud demand is starting to weaken.” While Ho applauded Micron for trying to limit its supply growth, he said that “Samsung’s unwillingness to cut back on capex and production will likely prolong the downturn.” As for KLA, he wrote that the company is “overexposed” to foundry/logic wafer-fab-equipment (WFE) spending, and Ho sees “growing uncertainty” around that category. Micron shares are down 37% over the past 12 months, while KLA shares are off 5%. The S&P 500 SPX, +0.50% has shed about 16% over the same span.

This article was originally published by Marketwatch.com. Read the original article here.

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