Citi Has Buy On Teradyne

Citi Investment Research is out with a research report on Teradyne Inc TER and it has a Buy rating and a $24 price target on shares. In a note to clients, Citi Investment Research writes, "Given the chip inventory buildup and soft end-market demand, the order/rev decline comes as no surprise. However, the magnitude of the decline is sharper than we expected, a clear indication of significant slowdown in IDM orders on top of almost zero activities at OSATs. The question is how long this drop will last. Taking a conservative 45% SOC market share by TER (vs. 51% in 2010), CQ3's ~$230MM SOC rev by TER indicates a $2.0B buy-rate. This is ~25% below the $2.6-$2.7B consensus estimate for 2011 SOC market. We argue that this is not sustainable based on 6-8% semi unit growth, and we could see a bounce back in Q4 if some of the macro concerns dissipate." Shares of TER lost 63 cents yesterday to close at $13.76.