** Morgan Stanley downgrades chipmaking equipment supplier KLA Corp KLAC.O to "equal-weight" from "overweight"

** Shares of the company marginally down 0.15% at about $1,070 in early trading

** However, brokerage lifts PT to $1,093 from $928, new PT shows a premium of 2% from the stocks last close

** Morgan Stanley sees limited relative upside due to KLAC's premium valuation compared to peers Applied Materials and Lam Research

** Brokerage still expects co to outpace the water fabrication equipment market in 2025 and 2026, citing a "rich catalyst path for a re-rating" already be priced in

** Notes co holds a dominant position in semiconductor process control, with its metrology and inspection tools embedded in the manufacturing workflow of TSMC and Samsung

** 13 of 27 brokerages rate the stock "buy" or higher, 14 "hold"; their median PT is $930- data compiled by LSEG

** Including session moves, shares up 69.8% YTD

(Reporting by Apratim Sarkar)

((Apratim.Sarkar@thomsonreuters.com))