Jefferies Downgrades Mellanox Technologies (MLNX) to Underperform on Competitive Pressure from Intel
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Jefferies downgraded Mellanox Technologies (NASDAQ: MLNX) from Hold to Underperform with a price target of $37.00 (from $42.00), saying they are increasingly concerned the company will see significant incremental pressure on its InfiniBand business from Intel’s launch of Skylake.
Analyst James Kisner commented, "We conducted checks at the SC16 trade show in Salt Lake City. We are increasingly concerned that MLNX will see significant incremental pressure on its InfiniBand business from Intel’s launch of Skylake in H1’17 and potentially share loss from CAVM in Ethernet NICs. Our CY17 revenue and EPS estimates are now 5% and 19% below the Street, respectively. We’re downgrading MLNX to Underperform."
The firm cut FY 2017 EPS from $3.40 to $3.15.
Shares of Mellanox Technologies closed at $44.85 yesterday.
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