Morgan Stanley published a note on Greater China technology semiconductors, reassessing the co-packaged optics (CPO) supply chain. The broker argues that recent CPO-related sell-offs have fully reset expectations, and identifies testing as the key bottleneck for 2027 capacity expansion. It reiterates Outperform ratings on most test and equipment names while downgrading FOCI to In-Line.
Morgan Stanley remains bullish on the CPO test and equipment supply chain, recommending buying on dips, but downgrades FOCI due to intensifying FAU competition.
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