Collins Stewart Downgrades DTS Inc. (DTSI) to Neutral; Blu-ray PC Outlook Challenged

October 14, 2011 7:03 AM EDT
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Price: $42.52 --0%

Rating Summary:
    1 Buy, 5 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 15 | Down: 13 | New: 24
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Collins Stewart downgraded DTS Inc. (NASDAQ: DTSI) from Buy to Neutral, price target cut from $40 to $30.

Collins analyst says, "We are downgrading DTSI and lowering our PT to $30 as discussions with multiple PC makers, suppliers, and CE OEMs indicate the Blu-ray (BD) market has begun to show indications of secular maturity given 1) PC BD attach rates remain at only 4-5% in 2011 with limited growth prospects moving forward; 2) PC Ultrabooks represent a secular headwind for optical disk drives (ODD); 3) Weak TV demand has impacted the outlook for standalone BD players. While our estimates still project meaningful growth into 2012, we believe the stock will remain range-bound until these end markets begin to show a more meaningful uptrend. As such we view valuations at current levels as balanced."

For more ratings news on DTS Inc. click here and for the rating history of DTS Inc. click here.

Shares of DTS Inc. closed at $26.78 yesterday.

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