Needham & Company Downgrades Volterra Semiconductor (VLTR) to Buy; Fine Tuning The Model

Needham & Company downgraded Volterra Semiconductor (NASDAQ: VLTR) from Strong Buy to Buy, price target cut $1 to $28.00.

Needham analyst says, "VLTR reiterated its Q4 guidance at its analyst event two weeks ago and was generally upbeat about prospects in 2012. We also note that management felt that the HDD issues out of Thailand were negligible with regards to its own risks with enterprise customers but felt the 2nd tier and lower PC customers were likely to see shortages. With the related pre-announcement out of Intel we do expect this HDD supply chain calamity to weigh on investor sentiment despite Intel reiterating strength in Romley (servers). The adoption of the Romley architecture coupled with a new gross margin strategy that involves not only the geometry shrinks, but also offshore initiatives in China to lower costs will offer financial tailwinds to VLTR in 2012. Since we upgraded VLTR shares from Buy to Strong Buy exactly a year ago, VLTR has risen 2% whereas the SOX index has declined 11%. While this has been a respectable return, we will revisit our price target and rating in early 2012 as VLTR is poised to grow and we shift our valuation on the analog group from 2012 P/E multiples to 2013 multiples...We lowered our revenue/EPS from $199M/$1.75 to $195M/$1.70 and introduced our 2013 estimates of $210M/$1.85."

For an analyst ratings summary and ratings history on Volterra Semiconductor click here. For more ratings news on Volterra Semiconductor click here.

Shares of Volterra Semiconductor closed at $24.00 yesterday.

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