Citi Maintains Hold on KLA Tencor

Citi is out with its report today on KLA Tencor KLAC, maintaining Hold. In a note to clients, Citi writes, "We rate the shares of KLAC Hold, High Risk (2H). We have taken a negative view of semiconductor capital equipment stocks given semiconductor fundamentals begin to slow in 1H:11 as supply accelerates and demand slows leading to risk of inventory building and orders correction after several qtrs of ramp. However, with CQ2 orders already dipped below normalized WFE average, and 2012 is shaping up to be at/above normalized level, we expect WFE orders to trough in 2H and rebound to $30B run-rate again." Shares of KLAC closed Tuesday at $43.71.