Collins Stewart Maintains a 'Buy' on Sigma Designs (SIGM); Recovery Still Back-end Loaded

Collins Stewart maintains a 'Buy' on Sigma Designs (NASDAQ: SIGM) price target of $14.00.

Collins analyst says, "While we maintain our Buy rating and $14 PT on SIGM ahead of the company's FQ2'12 (Jul) results, we don't foresee a meaningful recovery in market share and a return to revenue growth until the end of the year. We anticipate near-term results should continue to reflect continued impacts from STB OEM (Motorola (NYSE: MMI) / Cisco (Nasdaq: CSCO)) transition from SIGM to BRCM SOCs, despite indications of a slight recovery in market share. Additionally, we expect consumer headwinds and product pushouts will likely delay a recovery in Connected Home & Media."

"We expect SIGM to report FQ2'12 results inline to slightly below our/St rev est of $53.3M (-12% q/q) / $52.4M (-14% q/q) and guidance of $50-55M (-13% q/q). Our/St PF EPS ests are ($0.02). While we believe the company has started to recover some market share on Microsoft (Nasdaq: MSFT) Mediaroom, we believe the impacts of share loss to Broadcom (Nasdaq: BRCM) continues to stall out the company's recovery."

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

Shares of Sigma Designs closed at $8.37 yesterday.

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