Needham & Company Upgrades Qorvo Inc (QRVO) to Buy; $88 PT

Needham & Company upgraded Qorvo Inc (NASDAQ: QRVO) from Hold to Buy with a price target of $88.00 on impressive earnings leverage.

Analyst N. Quinn Bolton commented, QRVO delivered impressive beat and raise results on all metrics in F4Q15 on strong shipments of the iPhone 6/6 Plus. Management expects continued robust revenue growth in C2H15 as it has high visibility into the major Tier 1 OEM platform launches later this year. Additionally, QRVO expects continued 4G adoption in the emerging markets to drive strong growth in F1Q16 and C2H15, echoing recent peer commentary. Operating leverage was also better than expected and management now believes the company will exceed previous merger synergy targets. Accordingly, we believe QRVO may exceed its target ~50%/~30% NG GM/OM model in C2H15. We believe QRVO's valuation multiple has yet to reflect the greater than expected synergies, revenue growth and operating leverage. We upgrade QRVO to Buy with a PT of $88, or 15X our CY16 NG EPS estimate."

The firm increase FY16 and FY17 revenue/NG EPS estimates to $2.90bn/$4.95 and $3.29bn/$6.20 from $2.83bn/$4.75 and $3.15bn/$5.75, respectively

For an analyst ratings summary and ratings history on Qorvo Inc click here. For more ratings news on Qorvo Inc click here.

Shares of Qorvo Inc closed at $69.06 yesterday.

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