From Briefing.com: 8:46AM AMD estimates raised above consensus at Bernstein 14.70: Bernstein believes that AMD's Q4 is tracking above consensus due to both the PC processor and flash memory businesses; firm raises their Q4 sales/EPS ests to $1.118 bln/$0.07 from $1.082 bln/$0.01 (consensus $1.074 bln/$0.03), and raises their 2004 est to $0.40 from $0.22 (consensus $0.26) due to their increased conviction that AMD will drive out costs in its flash memory biz and benefit from increasing blended avg selling prices in its processor biz during 2004; firm also believes that AMD is likely to announce a manufacturing partner for its 300mm manufacturing facility during Q1, which would be a potential positive catalyst. Maintains Mkt Perform rating and raises target to $16 from $14.
8:16AM TMTA started with a Buy at A.G. Edwards; tgt $5 3.24: A.G. Edwards initiates coverage with a Buy/Speculative rating and 12-18 month price objective of $5 based on 5x firm's 2005 revenue estimate of $200 mln; firm thinks Transmeta will be able to achieve a high price/sales multiple as revenues ramp sharply from their current low of $2.7 mln in the SeptQ to, firm projects, $200 mln in sales in 2005; expects that the stock will eventually settle into a P/E valuation range of 20x-30x forward earnings when the company approaches normalized earnings capability of a net margin of about 15%.
8:03AM Altera: Motorola to integrate Altera FPGAs in new high-definition Satellite Receiver (ALTR) 22.54: Co announces that Motorola, Inc. (MOT) Broadband Communications Sector has selected Altera Cyclone FPGAs for use in the new Motorola Digital Satellite Receiver 500 family of high-definition satellite receivers.
7:56AM Barron's comments on Intel's PCI Express and its implications for the PC industry : Barron's highlights Intel as it will be first implement the PCI Express technology, which is the next generation of the "bus" line that carries data inside a personal computer, in a set of processor support chips code-named Grantsdale. The chips will ship with fast new versions of the Pentium 4 with Graphics performance suggested to immediately benefit as even the entry-level PCI Express products will have twice the connection speed of today's graphics systems. According to the article, this development is an exciting prospect for graphics accelerator specialists like ATYT and NVDA. In addition, smaller chip makers such as ICST whose clock chips keep computer parts working in synchrony, should benefit as well. ICST believes PC circuit boards will need more clock chips to work with the PCI Express. Marvell Technology Group (MRVL) and Toronto-listed Tundra Semiconductor will also be shipping PCI Express versions of their chips. Distributors like RHAT now supply versions of Linux for computers containing more than a dozen processors. However, Networking vendors have rolled out a rival technology for connections inside of their boxes called RapidIO. Like PCI Express, the RapidIO technology has plenty of bandwidth and its backed by Intel chip rivals like IBM, MOT and TXN, who aren't eager to help Intel expand beyond computing.
7:51AM Smith Barney raises chip industry growth forecast : Smith Barney now estimates that the worldwide chip industry will grow about 20% in 2004, up from their previous est of 14% growth, due to rising unit demand, better prices, and inventory restocking by customers. Firm now anticipates about 7-8% ASP improvement vs 2-3% previously, and raises their unit forecast slightly to 12-13% vs 11-12% previously. Consequently, firm believes there is likely an upward bias to co-specific ests entering earnings season, and they continue to favor stocks with margin leverage potential such as CY, FCS, and INTC. Firm projects 2005 to be the peak absolute sales year for the current cycle, but says the YoY growth peak is expected in 2004, which should be the peak period for chip stocks.
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