Broker snap: IQE 'due a bounce', says Investec

8th Apr 2013 10:48

AIM-listed tech group IQE was performing well on Monday morning after Investec upgraded the stock from 'sell' to 'hold', saying that the advanced semiconductor firm is 'due a bounce'."With IQE shares having underperformed over the weeks since the FY12 results, we see current levels as offering fairer value," Investec said."Whilst we have argued that the cash profile of the RFMD deal and the recently-increased debt level need to be taken into consideration in valuing the equity, we believe the extent of the price weakness could mean the shares are due a bounce."The broker said that the recent underperformance - with shares down 16% over the last month (including Monday's jump) - was due to the market's "frustration" with the disappointing full-year results and worries about the impact of Qualcomm and competitive, silicon-based products.Investec said it is sensible for investors to wait for potential attractive growth avenues - such as solar and compound-on-silicon - to mature.Shares were up 7.39% at 23.62p by 10:25.BC