UPDATE 1-Oppenheimer raises Kulicke and Soffa to "outperform"
* Raises price target on stock to $11 from $5
* Sees Taiwanese sub-contractors driving revenue for co
* Shares up 11 percent
Jan 7 (Reuters) - Oppenheimer raised its rating on Kulicke and Soffa Industries Inc (KLIC.O) to "outperform," saying the chip equipment maker could see increased revenue growth as its Taiwanese customers have resumed capacity addition.
Shares of Kulicke and Soffa rose as much as 11 percent in morning trade on Friday.
Oppenheimer said the firm's Taiwan-based sub-contractors, Advanced Semiconductor Engineering Inc (ASX.N) and Silicon Precision Industries Co Ltd (SPIL.O), are seeing better-than-seasonal volumes, leading to ramped up production.
Kulicke and Soffa should gain from its Taiwanese sub-contractors resuming their transition to copper wirebonding from gold in producing chips, resulting in a 20-30 percent sequential rise in revenue, the brokerage added.
Wirebonding is the process of making interconnections between an integrated circuit and a printed circuit board during semiconductor device fabrication.
Kulicke and Soffa manufactures and sells ball bonders and wire wedge bonders used in Wirebonding.
Oppenheimer said it sees a better-than-seasonal semi-chip volume for the sub-contractors in the first quarter, mainly driven by still-lean inventory levels and the continued outsourcing for fabricating chips.
Shares of the Fort Washington, Pennsylvania-based company, which have gained 23 percent in volume since posting better-than-expected quarterly results in November, traded up 11 percent at $8.48 on Friday morning on Nasdaq. (Reporting by Siddharth Cavale in Bangalore; Editing by Joyjeet Das)
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