With the probability that LTX-Credence will merge with Verigy (Nasdaq:VRGY), Needham & Company said they see no reason to invest in LTXC at this time. They maintain their "Hold" rating on LTX.
LTX-Credence said they're high on the beta test of the ASLx, which is due to ship in the first quarter of January.
Needham said, "...Management was optimistic on its beta test of the ASLx, due to ship in JanQ1. We note that Verigy (VRGY, U/R) reported OctQ4 revenue/EPS of $159M/$0.29 vs. consensus of $164M/$0.28. VRGY's soft JanQ1 guide was $118M/($0.01) at the midpoint compared to consensus of $145M/$0.17. We lowered our FY2011 revenue/EPS from $304M/$1.43 to $263M/$1.05 and our FY2012 revenue/EPS from $295M/$1.25 to $276M/$1.15. Due to the likely merger with Verigy, we maintain that LTXC shares are bound to the performance of VRGY shares and as such believe there is no urgency to get involved in LTXC shares near-term."
LTX closed Wednesday at $8.11, gaining $0.26, or 3.31 percent. Volume was three times the 3-month daily average.
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