Auriga Cuts Estimates on PMC-Sierra (PMCS); Disappointing Guidance Partially Offset by Strong Bookings

Auriga maintains a 'Hold' on PMC-Sierra (NASDAQ: PMCS) price target of $6.50.

Auriga analyst says, "We maintain our rating and price target for PMCS as the company's 1Q12 guidance fell significantly short of estimates on unexpected weakness in storage segment due to hard disk drive (HDD) constraints and seasonal declines. A weak guidance was partially offset by a strong 1.2+ Book-to-Bill, a large decline in legacy overhang and a commitment to reduce opex in 2H12 to 1H11 levels. However even as order trends improve, we remain cautious on overall carrier capex trends for 2012. We substantially reduce our estimates and remain on the sidelines until we see a stronger acceleration in growth momentum and/or a more compelling valuation."

For an analyst ratings summary and ratings history on PMC-Sierra click here. For more ratings news on PMC-Sierra click here.

Shares of PMC-Sierra closed at $6.74 yesterday.

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