Collins Stewart Cuts Price Target on Dolby Laboratories (DLB), Weak End Markts Across The Board

Collins Stewart is maintaining its Buy rating on shares of Dolby Laboratories (NYSE: DLB) as it feels that all of the bad news is already priced in, but is reducing its price target from $75 to $55.

The price target reduction reflects the company's weak end-markets in PCs, TVs, and Blu-ray and DVD. The firm anticipates that DLB will lower its FY11 guidance and believes that investors have already priced this new into the stock. This is mostly due to supply chain disruptions in Japan.

The firm reports that, "We still remain confident that Dolby will be highly successful in monetizing China in the long run with key opportunities in STBs and TVs, as the country will become largest LCD TV market in the world in 2011. However, issues with leakage and the lack of a digital terrestrial standard has prevented Dolby from meaningfully monetizing this market."

Collins Stewart's 2011 and 2012 EPS estimates are $2.68 and $2.85 while its revenue estimates are $954 million and $1,040 million.

For more ratings news on Dolby Laboratories click here and for the rating history of Dolby Laboratories click here.

Shares of Dolby Laboratories closed at $45.62 yesterday.

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