Morgan Stanley Upgrading KLA-Tencor Corporation

Morgan Stanley is out with a research report on KLA-Tencor Corporation KLAC and is upgrading shares to Overweight with a $50 price target on shares. In a note to clients, Morgan Stanley writes, "We upgrade KLAC to OW from EW, raise FY13 estimates 16% above consensus, and establish a $50 price target based on a) higher process control equipment spend for more complex smartphone devices and b) potential foundry diversification by Apple to benefit KLAC in the next 12-18 months." Shares of KLAC fell 46 cents on Friday to close at $36.20.