Needham & Company Maintains a 'Buy' on RadiSys (RSYS); Solid 3Q10 Results, But 4Q Guide and 2011 GM Outlook Disappoint
RSYS Hot Sheet
Rating Summary:1 Buy, 0 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 20 | Down: 11 | New: 38
Needham & Company maintains a 'Buy' rating on RadiSys Corp. (Nasdaq: RSYS), lowers PT from $12 to $11.
Needham analyst says, "While the growth trajectory of RSYS’ Next-Gen business (+20% y/y in 2010) remains largely on track with our prior expectations, greater
than expected margin erosion in its legacy business significantly alters the GM expectation for 2011, which is now for flat with 2010, vs. our prior expectation of 200+bps of expansion. While clearly disappointing, the company’s more aggressive stance on expenses helps offset some of lower gross profit and should enable EPS growth even on flattish revenue...We are reducing 4Q10 in line w/ guidance. For 2011, our new estimates are $288MM/$0.65 PF EPS from $295MM/$0.70. We introduce 2012 estimates of $301MM and $0.82."
To see all the upgrades/downgrades on shares of RSYS, visit our Analyst Ratings page.
Shares are currently trading at $9.80, down $0.11 (-1.11%)
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Needham analyst says, "While the growth trajectory of RSYS’ Next-Gen business (+20% y/y in 2010) remains largely on track with our prior expectations, greater
than expected margin erosion in its legacy business significantly alters the GM expectation for 2011, which is now for flat with 2010, vs. our prior expectation of 200+bps of expansion. While clearly disappointing, the company’s more aggressive stance on expenses helps offset some of lower gross profit and should enable EPS growth even on flattish revenue...We are reducing 4Q10 in line w/ guidance. For 2011, our new estimates are $288MM/$0.65 PF EPS from $295MM/$0.70. We introduce 2012 estimates of $301MM and $0.82."
To see all the upgrades/downgrades on shares of RSYS, visit our Analyst Ratings page.
Shares are currently trading at $9.80, down $0.11 (-1.11%)
Discover Wall Street's best ratings calls with the pros - Ratings Insider Elite. Free Trial!
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