Altera Gets Revs Lift From Wireless Segment
03.10.05, 10:18 AM ET
Banc of America Securities reiterated a "neutral" rating on Altera (nasdaq: ALTR - news - people ), saying a recovery in industry fundamentals will benefit the chipmaker's sales while company spending plans for calendar 2005 is likely to limit operating margin improvement in coming quarters. The research firm raised the target price on Altera to $21 from $19. For the first quarter, Altera raised the revenue growth guidance to approximately a 6% sequential rise, from prior guidance of 1% to 3%. "While the company did not comment on gross margin expectations, we believe gross margins are tracking in line with guidance," Banc of America said. Altera reported revenue is being primarily driven by the communications segment. "We note that Altera's comments mirror those made by Xilinx (nasdaq: XLNX - news - people )," Banc of America said. "Within communications, we think wireless infrastructure was a primary driver of strength for Altera." Banc of America raised the 2005 and 2006 earnings-per-share estimates on Altera to 60 cents and 76 cents, respectively, from 54 cents and 70 cents. Elsewhere in the semiconductors sector, Banc of America's top picks are Maxim Integrated Products (nasdaq: MXIM - news - people ) and Power Integrations (nasdaq: POWI - news - people ), both rated at "buy" with target price of $50 and $23.50, respectively. Its least favorite picks are Lattice Semiconductor (nasdaq: LSCC - news - people ) and Micrel Semiconductor (nasdaq: MCRL - news - people ), both rated at "sell" with target prices of $4 and $7.50, respectively. |
