Adams Harkness Cuts Numerical Technologies to 'Market Perform'

Analyst Dennis Wassung says the CEO's resignation further shakes investors' near-term confidence in the chip equipment company

Adams Harkness downgraded Numerical Technologies (NMTC ) to market perform from buy.

Analyst Dennis Wassung says the resignation of president and CEO Larry Hollatz after just four months presents a risk factor, and further shakes investors' near-term confidence in the chip equipment company. He notes Hollatz left because of differences with the board over the strategy and direction of the company going forward. He doesn't expect a meaningful recovery in the share price until visibility on the renewal of Cadence Design Systems' licensing agreement, or an announcement of a new production license elsewhere.

Wassung sees one cent earnings per share for the fourth quarter, and $11.2 million in revenues, in line with the company's guidance.

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