Needham & Company Downgrades Mellanox Technologies (MLNX) to Hold

April 25, 2013 9:25 AM EDT Send to a Friend
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Price: $41.79 --0%

Rating Summary:
    12 Buy, 9 Hold, 0 Sell

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Needham & Company downgraded Mellanox Technologies (NASDAQ: MLNX) from Buy to Hold on lack of visibility/clarity and lumpiness in the business model.

Analyst Glenn Hanus comments, "While we remain positive on MLNX's Infiniband /Ethernet technology and favorable prospects for its increasing presence in HPC and more recent verticals such as Web2.0, Cloud, storage, financials and database/datacenter, we are changing our rating to Hold (was Buy) on lack of visibility/clarity and lumpiness in the business model, reduced estimates and healthy current valuation relative to our revised expectations. We are finding it increasingly difficult to provide a ‘13/14 financial model with any conviction. We note that MLNX reported a solid 1Q at the high-end of guidance but issued 2Q modestly below Street. MLNX does expect some q/q revenue growth through ’13. We are reducing our ‘13/14 estimates as indicated."

The firm cut FY 2013 EPS estimates from $2.11 to $1.06 and cutting FY 2014 EPS estimates from $2.91 to $1.89.

For an analyst ratings summary and ratings history on Mellanox Technologies click here. For more ratings news on Mellanox Technologies click here.

Shares of Mellanox Technologies closed at $61.83 yesterday.




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