JANCO Downgrades Dolby Labs (DLB) to Accumulate; Consumer Electronics and PC Segments Expected to be Down Significantly

July 20, 2009 11:52 AM EDT

JANCO downgrades Dolby Labs (NYSE: DLB) from Buy to Accumulate. $43 Price target.

JANCO analyst says, "We are forecasting a weak quarter for Dolby, with consumer electronics and PC segments expected to be down significantly, and the broadcast segment weakening with a smaller contribution from the digital transition. We expect the gaming and mobile category to show relative strength. All that having been said, we believe the expectations for the quarter are very achievable, and Dolby has a history of beating consensus estimates...In our opinion, the dynamics in the PC arena will be key determinants of Dolby's valuation going forward. We believe the near-term outlook on this front is favorable for Dolby, but the medium and long-term outlooks could be more challenging. With Intel (Nasdaq: INTC) having reported strong results, and Windows 7 (Nasdaq: MSFT) due to launch in 4Q09, expectations for the second half are likely to be improving. That said, we believe the consumer economy remains a challenge, as does the shift toward netbooks, and more competition in the operating system landscape."

To see more analyst ratings on DLB Click Here.

Dolby Laboratories, Inc. engages in the development and delivery of products and technologies for the entertainment industry.

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