Nomura Securities on U.S. Semiconductors: Cautious on Altera (ALTR)
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Price: $111.85 --0%
Rating Summary:
4 Buy, 8 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
4 Buy, 8 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Nomura Securities on U.S. Semiconductors
Analyst, Romit Shah, said, "Following up from our initiation in March, we believe investors are still overvaluing shares of Altera (Nasdaq: ALTR) (Reduce), considering capex spending trends, structural design changes, and 28nm execution. Near term, we do not expect Altera’s mid-quarter update on Thursday to be a catalyst. Rather, consensus expectations for 8% growth in Q3 and 6% growth in Q4 seem like high hurdles. Altera trades at 16x CY13 EPS on revenue growth of 20%, vs. a comp avg of 12x CY13 EPS on revenue growth of 10%. Our target moves from $33 to $30."
"Moreover, our analysis of industry data and field surveys lead us to believe that SoC solutions from TI (NYSE: TXN), Freescale (NYSE: FSL), and MindSpeed (Nasdaq: MSPD) are taking share in macro base stations due to lower costs and power consumption. Alcatel-Lucent’s LightRadio architecture is based on Freescale SoC, while Nokia Siemens is using TI’s Keystone SoC in its next generation Liquid Radio offering."
Analyst, Romit Shah, said, "Following up from our initiation in March, we believe investors are still overvaluing shares of Altera (Nasdaq: ALTR) (Reduce), considering capex spending trends, structural design changes, and 28nm execution. Near term, we do not expect Altera’s mid-quarter update on Thursday to be a catalyst. Rather, consensus expectations for 8% growth in Q3 and 6% growth in Q4 seem like high hurdles. Altera trades at 16x CY13 EPS on revenue growth of 20%, vs. a comp avg of 12x CY13 EPS on revenue growth of 10%. Our target moves from $33 to $30."
"Moreover, our analysis of industry data and field surveys lead us to believe that SoC solutions from TI (NYSE: TXN), Freescale (NYSE: FSL), and MindSpeed (Nasdaq: MSPD) are taking share in macro base stations due to lower costs and power consumption. Alcatel-Lucent’s LightRadio architecture is based on Freescale SoC, while Nokia Siemens is using TI’s Keystone SoC in its next generation Liquid Radio offering."
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