The Dividend Daily

KLA-Tencor Corporation (KLAC), which provides process control and yield-management services to the semiconductor industry, said late Thursday that its third quarter profit rose 6% from last year, helped by cost cuts amid sharply lower revenue.

The San Jose-based company reported third quarter net income of $20.4 million, or 12 cents per share, up from $19.3 million, or 11 cents per share, in the year-ago period. Excluding items, adjusted profit was 15 cents per share, compared with a much-higher 32 cents last year.

Revenue plunged 35% from last year, to $347.7 million, while total costs and operating expenses fell 34%.

On average, Wall Street analysts expected a much lower profit of only 2 cents per share, on smaller revenue of $333.3 million.

KLA Tencor shares were mostly flat in premarket trading Friday.

The Bottom Line
We have avoided the shares of KLAC since we started our early June coverage last year, and the stock was trading at $42.83. The company has a 1.75% dividend yield, based on last night’s closing stock price of $34.28. The stock has technical support in the $30 price area. If the shares can gain some momentum on this analyst call, we see overhead resistance around the $37-$40 price levels. We would remain on the sidelines for now.

KLA-Tencor Corporation (KLAC) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

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