QCOM--Sawtek falls on news of new product
By Jason Margolis, CBS.MarketWatch.com
Last Update: 2:31 PM ET Dec 18, 2000
ORLANDO, Fla. (CBS.MW) - Sawtek shares fell 25 percent on Monday following news concerning a new Qualcomm product that could make a Sawtek product obsolete.
On Monday morning, San Diego-based Qualcomm (QCOM: news, msgs) announced its new technology for Code Division Multiple Access (CDMA) transceivers, using direct conversion for the wireless handset market. Qualcomm said that the new technology eliminates the need for Surface Acoustic Wave (SAW) filters, which are produced by Sawtek.
Sawtek responded to the announcement Monday afternoon. Chief Finacial Officer Raymond Link said, "Sawtek believes that the introduction of this new technology will have little or no impact on its revenues or profits for fiscal 2001."
Qualcomm will begin sampling its new product during the fourth-quarter 2001.
Also on Monday following the Qualcomm announcement, Banc of America lowered its rating on Sawtek to a "buy" from "strong buy," and cut its price target to $75 from $100. Analyst Mark McKechnie said he does believe, however, that Sawtek has "planned" for competitive products and should be able to maintain better than 30 percent long-term growth.
Shares of Orlando, Fla.-based Sawtek (SAWS: news, msgs) fell $16.38 to $48.63. The company uses its technology to allow users to filter out unwanted signals from telecommunications, cable TV, cellular telephones and satellite systems.
Qualcomm shares rose $5.88, or 7.4 percent, to $85.44 on Monday. |
