Jaffray remains cautious on Amkor Technology (AMKR).
Analyst Jesse Pichel says the weaker outlook reflects a loss of market share in high-end micro lead frames to rivals Chippac and Advanced Semiconductor Engineering, which have more competitive offerings. He says Amkor is also losing share of the stacked-packages market, in which Chipac leads in technology and resources.
Pichel says Amkor has a large capacity in the low-end plastic ball grid-arrays market, but gross margin in this business is 20 basis points below the high-end businesses. He says Amkor is trying to be the "supermarket of packaging," but it's unable to maintain high margins and the problems are company-specific. He's also reviewing his market outperform rating and earnings estimates.