Collins Stewart semiconductor analyst Ramesh Misra this morning turned cautious on semiconductor stocks with high exposure to consumer demand. As noted in a series of research reports, Misra cut his ratings on Atheros (ATHR), California Micro Devices (CAMD), Supertex (SUPX), HiFN (HIFN) and Tower Semiconductor (TSEM) to Hold from Buy. Some sound bites:

• Atheros: “Has been one of the most consistent performers in the industry; however, we believe that the weakness in the consumer sector could crimp the company’s growth.”
• California Micro: “The company is significantly reliant upon the wireless handset markets for its growth, and Motorola has historically been an important customer. Even though the company also counts Samsung and Nokia as customers, we think weakness at Motorola will adversely impact the company for some time.”
• HiFn: “We are concerned about the competitive dynamics in the enterprise networking and storage markets that HiFn participates in.”
• Supertex: “Supertex has historically been very reliant upon growth Motorola to drive its handset electroluminescent driver business. However, that business has declined very sharply in recent quarters, and the likelihood that it will recover anytime soon is very slim…we believe the company faces poor visibility in the near-term.”
• Tower Semi: “Even as the company has out-performed the overall semiconductor industry, and its foundry peers in recent years, we think valuations in the foreseeable future will be depressed due to the expected weakness in the U.S. economy. Some of Tower’s customers such as Sandisk and Atheros have a meaningful exposure into the consumer sector, which could result in constraining growth from those customers.”