Needham & Company Upgrades Synaptics (SYNA) to Hold; Negative Thesis Has Played Out
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Price: $108.63 +1.23%
Rating Summary:
10 Buy, 13 Hold, 1 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
10 Buy, 13 Hold, 1 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Needham & Company upgraded Synaptics (NASDAQ: SYNA) from Underperform to Hold.
Needham analyst says, "We are upgrading SYNA as our negative thesis has played out and the company has largely completed its transition to a chip-only business model. Since our downgrade to Under Perform on 1/21/11, SYNA’s shares have declined 16% vs. -5% for SOX index. While we’ve remained bearish as SYNA underwent the difficult transition to a chip-only model (now 90% of mobile sales), SYNA’s new business model is now significantly stronger. Our upgrade is based on the following points: 1) gross margin and operating margin leverage as SYNA drives chip/tail solutions; 2) pricing pressure on mobile ASPs will start to abate exiting C1H12; 3) nicely levered to the growing China handset market with dominant relationships with ZTE and Huawei (Both Not/Rated); 3) competitive advantage with on-cell/in-cell and sensor on lens implementations; & 4) mobile revenue growth exiting FY13 (C2H12)."
"Our FY12 and FY13 estimates increase to $565MM/$2.47 (vs. $524MM/$1.82) and $605MM/$2.60 (vs. $591.0MM/$2.46), respectively."
For more ratings news on Synaptics click here and for the rating history of Synaptics click here.
Shares of Synaptics closed at $27.02 yesterday.
Needham analyst says, "We are upgrading SYNA as our negative thesis has played out and the company has largely completed its transition to a chip-only business model. Since our downgrade to Under Perform on 1/21/11, SYNA’s shares have declined 16% vs. -5% for SOX index. While we’ve remained bearish as SYNA underwent the difficult transition to a chip-only model (now 90% of mobile sales), SYNA’s new business model is now significantly stronger. Our upgrade is based on the following points: 1) gross margin and operating margin leverage as SYNA drives chip/tail solutions; 2) pricing pressure on mobile ASPs will start to abate exiting C1H12; 3) nicely levered to the growing China handset market with dominant relationships with ZTE and Huawei (Both Not/Rated); 3) competitive advantage with on-cell/in-cell and sensor on lens implementations; & 4) mobile revenue growth exiting FY13 (C2H12)."
"Our FY12 and FY13 estimates increase to $565MM/$2.47 (vs. $524MM/$1.82) and $605MM/$2.60 (vs. $591.0MM/$2.46), respectively."
For more ratings news on Synaptics click here and for the rating history of Synaptics click here.
Shares of Synaptics closed at $27.02 yesterday.
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