There is more pain ahead for semiconductor stocks, according to Raymond James.

The firm reduced its 2019 earnings estimates for eight chip stocks, predicting companies will announce weakness in business activity.

After spending a week in Asia talking to chip supply chain companies, Chris Caso downgraded several semiconductor stocks on Sept. 25, saying the sector has entered a "cyclical downturn."

"Since we downgraded the group … stock prices have fallen sharply, the volume of negativity from the rest of the Street has increased markedly, and we believe most investors now expect some degree of estimate cuts," the Raymond James analyst said in a note to clients Monday. We are "cutting estimates across much of the space. … Net, we think it's too early to call a bottom, despite what's now widespread bearish sentiment among investors."

The iShares PHLX Semiconductor ETF has declined nearly 6 percent since Sept. 24 through Friday versus a modest 1 percent fall for the S&P 500. The chip sector ETF closed down 1.1 percent Monday.

Caso cut his Intel 2019 earnings per share forecast to $4.02 from $4.24. He also reduced his 2019 earnings estimates for several other chip stocks, including Analog Devices, Maxim Integrated and Texas Instruments.

The analyst believes chip stocks will continue to fall until more semiconductor companies admit to deteriorating business trends. He told clients to look for positive stock price action on negative announcements as a signal a "bottom" is near.

"In order for semis to bottom, we need to hear bad news from the companies themselves," he said. "We do however expect this to occur quickly, and wouldn't be surprised to be buying semis again in the November – March time frame. The best indicator that weakness is dialed into stocks is when stocks stop going down on bad news."