Piper Jaffray Assumes ANADIGICS (ANAD) with a Neutral

July 23, 2008 9:46 AM EDT

Piper Jaffray assumes coverage of ANADIGICS (NASDAQ: ANAD) with a Neutral rating. Piper lowers the price target from $10 to $8. In addition, the firm cuts their FY 2008 EPS estimate from $0.72 to $0.60, and lowers their FY 2009 EPS estimate from $0.82 to $0.74.

ANADIGICS reported Q2 revenue of $80.5M, higher than Piper’s $78.3M estimate and the Street’s estimate of $78.2M. In addition, the company reported non-GAAP EPS of $0.18, above consensus estimate of $0.16.

The firm said, "Despite a strong Q2, the recent weakness telegraphed by some handset manufacturers has manifested itself in ANAD's Q3 guidance. Representing 61% of Q2 revenue, the company's Wireless segment (which has been a growth engine, up 78% YoY in Q2) is expected to be down mid-to-high single digits sequentially. The softness is attributable to both lowered expectations for the handset manufacturers, as well as some customers working through inventory levels. Additionally, ANADIGICS is now splitting the Qualcomm business with Skyworks. Given that strength in the company's Broadband segment (WLAN, CATV infrastructure and set-top-boxes) should offset some of this weakness, we are expecting an overall 3% sequential decline in total revenue for Q3."

The firm expects gross margins to fall to the 35-36% range for the remainder of the year. However, the firm expects margins to climb again in 2009 as capacity from the NJ plant and foundry partners ramp.

ANADIGICS, Inc. is a provider of semiconductor solutions in the broadband wireless and wireline communications markets.

Related Categories

New Coverage

Stocks Mentioned

Related Entities

• Piper Jaffray

Add Your Comment

Name

Subject

Body

Verification can't see the text?
click here to refresh the image.
what's this?