Auriga Maintains a 'Hold' on NetLogic (NETL); Gross Margins Drive EPS Beat, But No Organic Growth

Auriga maintains a 'Hold' on NetLogic (NASDAQ: NETL) price target of $36.

Auriga analyst says, "We maintain our Rating and price target on NetLogic as the company reported a large EPS beat due to much higher than expected gross margins, but showed no organic top-line growth for print/guide from Q310 levels. A much higher than expected contribution from Optichron acquisition helped the company meet top-line expectations, while the company’s core KBP business continued to struggle despite competitor Renesas’ (6723-TKS, NR) supply chain issues."

"We raise our EPS estimates. Our CY11 estimate goes to $422.3mln/$1.68 (pro-forma EPS) from $422.0mln/$1.54 (consensus at $425mln/$1.55). Our CY12 estimate goes to $492.7mln/$1.86 from $491mln/$1.73 (consensus at $506.3mln/$1.82). We have raised our Optichron estimate, but reduced KBP expectations."

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

Shares of NetLogic closed at $34.78 yesterday.

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