Stock Downgraded: UTAC target price cut to 1.05 by Credit Suisse!

Credit Suisse says it has cut its target price for United Test & Assembly Center (UTAC) to 1.05 sgd from 1.26 sgd because it expects the chip testing and packaging company's earnings to have been weaker in the second quarter. It said that while UTAC stock has declined 20-25 pct from its peak and now offers attractive valuations, the company's near-term earnings outlook and weak market sentiment may continue to work against it. "A better time for entry will be in August, after the weak second-quarter result is out of the way, and there are clearer indications on the potential pick in the third and fourth quarter," the brokerage said in a note. Credit Suisse estimates that UTAC's net profit fell to 15 mln usd in the second quarter from 20.7 mln usd in the first. But it expects net profit to rise to 23 mln usd in the third quarter and to 25 mln usd in the fourth. At 9.46 am, UTAC was down 0.005 sgd or 0.63 pct to 0.795, on volume of 7. 56 mln shares.