7/14...Vitesse Shares Slump After Earnings Report
LOS ANGELES (Reuters) - Vitesse Semiconductor Corp. (NasdaqNM:VTSS - news) shares closed down more than 12 percent on Friday on apparent investor disappointment that the chipmaker's quarterly profits matched but did not exceed Wall Street forecasts.
Shares of the Camarillo, Calif.-based company fell 11-1/8 to 75-9/16 on the Nasdaq stock market, more than reversing strong gains scored on Thursday.
The semiconductor industry has been on a roll for much of this year -- bellwether Intel Corp. (NasdaqNM:INTC - news) closed at 146-11/16 just above its all-time high of 145-3/8 reached in late March -- and investors appeared to be disappointed that Vitesse failed to match the earnings trends seen at other chipmakers.
``Revenues at Vitesse were up 14 percent sequentially, compared with in excess of 20 percent at Altera (NasdaqNM:ALTR - news) and 30 percent at PMC-Sierra (NasdaqNM:PMCS - news),'' said Charles Glavin, an analyst at Credit Suisse First Boston.
Although Vitesse stock fell, shares of other chipmakers surged after reporting stronger than expected results.
Altera Corp. shares rose 8-3/8 to 119-7/16. On Thursday the company reported higher-than-expected earnings and set a two-for-one stock split. Altera's share price has more than tripled in the past 12 months. Both Lehman Brosand Credit Suisse First Boston said on Friday they raised their 12-month price targets for Altera following the higher-than-expected earnings.
Shares of Elantec Semiconductor Inc. (NasdaqNM:ELNT - news), based in Milpitas, Calif., rose 12 to 75-1/4 on Nasdaq. The stock has soared from a year low of 6-3/8.
``It's not that Vitesse is in a bad market, but they just don't seem to be getting the upside that other companies are seeing,'' Glavin said. ``We are not saying this is a company that will not continue to grow it's just that they're not growing as fast as some of the other comparables.''
After the market closed Thursday, Vitesse, which makes semiconductors for optical networking, reported net income of $32.1 million, or 17 cents a share, for the fiscal third quarter ended June 30, before amortization of goodwill and special charges, compared with $15.2 million or 8 cents a share a year ago. The results matched analysts' forecasts according to First Call/Thomson.
Including charges of $21.4 million related to the acquisition of Orologic Inc. and SiTera Inc., Vitesse had net income of $13.3 million, or 7 cents a share.
In Nasdaq trading on Thursday, ahead of the earnings report, Vitesse shares rose 6-3/4 to 86-11/16. The stock has a 52-week high of 115-11/16 and a low of 28-9/16. |
