Citigroup downgraded Veeco Instruments (VECO
) to hold from buy, after the technology equipment maker on Monday posted its quarterly results.
Veeco posted fourth quarter 2005 earnings of 22 cents per diluted share compared to fourth quarter earnings per diluted share of 3 cents in 2004.
Analyst Timothy Arcuri had estimated that the company would announce 18 cents earnings per share, compared to the Street's consensus average of 16 cents. But he says Veeco's product, the next-generation light-emitting diode (LED) technology for use in illumination, is not the boon to Veeco's business that he had expected. Among other things, he thinks that Veeco faces ongoing challenges at making profits in its LED business. He cut his $23 stock price target to $22.