Piper Jaffray Lowers PT To $37 On LLTC

Piper Jaffray has lowered its price target from $42 to $37 on Linear Technology Corp. LLTC after a weak quarter. In its report, Piper Jaffray writes, “LLTC reported a soft June quarter and offered a weak outlook for the September quarter. This is in stark contrast to our expectation of a strong quarter and up guidance. The company's press release indicated their customers built inventory in response to the Japan quake and as the supply chain returned to normal at the end of the quarter, customers reduced orders sharply as economic uncertainty increased. As a result, LLTC is forecasting revenue to decline 6-8% q/q in the Sept quarter. We believe this will result in a rapid drawdown of inventory and likely a short duration inventory correction. We expect a sharp snapback in the December quarter as auto production picks up and customers overshoot on the inventory correction. While we have been optimistic about LLTC's prospects, the market has not. We see limited downside from current levels and expect a strong rebound in December.” Piper Jaffray maintains an Overweight rating on the stock. LLTC closed at $31.20 yesterday.