UPDATE: Stifel Nicolaus Cuts PT to $40 on Microchip Technology on Capacity Reduction

Stifel Nicolaus reiterated its Buy rating on Microchip Technology MCHP but lowered its price target from $46 to $40. Stifel Nicolaus noted, “Similar to the 2008/09 economic downturn, Microchip management has taken measures to reduce capacity and opex without causing a longer-term disruption in manufacturing. We believe this will keep the company well positioned to react quickly to the eventual new demand. Although we lowered our estimates and 12-month target price, we continue recommending investors build a position in MCHP as the semiconductor cycle finds a bottom." Microchip Technology closed at $31.91 on Thursday.