Through TheFLY's Eyes: KLA Tencor

from Theflyonthewall.com







Management's Confidence Is Building

For those not overly familiar with the details of semiconductor equipment business, KLA Tencor (KLAC) is a gem of a company in this space. The company makes equipment that makes sure that semiconductors are produced efficiently and profitably.

This week KLA Tencor's management indicated that it will host an analyst day on July 11th to provide a three year business plan for the company. This is the first time that this company has provided such a long-term outlook for an industry known for its cyclical nature. When asked why management is doing this? Management responded that our confidence is building up regarding our business prospects.

KLA Tencor stock is down from $54 in March and now trades around $40, a big decline for this very profitable company. As 64-bit processing continues to get greater traction, new equipment will be required which plays right into this company's strengths. This stock has gotten too cheap and has to be owned at current price levels.