Piper Jaffray Reiterates Overweight Rating on Nanometrics (NANO)

Piper Jaffray is out with a research report this morning, where its analysts reiterated their Overweight rating on shares of Nanometrics NANO; they have a $22.50 price target on the stock. The Piper analyst said, “Investors generate returns in the chip equipment (sector) by timing the cycle, picking companies that offer the new products that are required for next generation processes, or picking the companies that are gaining share at leading customers.” They added, “While we continue to see evidence that the capital spending cycle is long from over, investors are not yet convinced. When we consider the list of products that are early in the adoption phase in fabs, Optical Critical Dimension metrology (OCD) comes to mind. When we look for the company that is winning at the 2x nm node at leading customers Intel, Samsung, and Toshiba it is NANO.” They also noted, “Based on our conversations, we believe the Street has underestimated NANO's opportunity at Intel. We also believe that NANO is increasing its penetration at Samsung and that the market for the Unifire product is bigger than was previously expected. Maintain Overweight rating and price target of $22.50, which is based on 15x our CY11 estimate of $1.50.”