Here's how Briefing.com sees the ESST warning:
ESS TECHNOLOGIES INC (ESST) 12 3/8 -2 1/4. Supplier of PC audio and digital video semiconductor solutions for the PC and consumer markets says that it expects 2nd qtr revenues to expand at only a 22% clip, citing weaker than anticipated seasonal demand for audio products, especially in the add-in sound card market, and competitive pricing pressures in the audio and video CD markets. In addition, ESS does not expect to meet analysts' $0.34 per share 2nd qtr estimate. For the period, the firm is forecasting earnings of $0.16 to $0.19 per share, on revenues of $56 to $61 million. The earnings prediction excludes a one-time charge of $0.64 per share resulting from the acquisition of Platform Technologies Inc for 2.54 million shares of ESS common stock. "We are optimistic about the impact of our new products going forward," ESS stated. All of our lines, including audio, video and communications, have new products in production that will begin shipping in June." Unfortunately, investors are not willing to be as patient as the company might like, and has accordingly unloaded the stock to the tune of 16%. Morgan Stanley is also taking the company off its Christmas card list, downgrading the issue to "neutral" from "outperform." On the flip side of the coin is Volpe Brown, which only three days ago started coverage with its highest rating, a "strong buy." At this point, the only action Volpe can really take to save face is to reiterate the recommendation. |
