Lam Research shares spike despite weak outlook
Associated Press 07.30.08, 2:12 PM ET
forbes.com
SEATTLE -
Shares of Lam Research Corp. surged Wednesday after the maker of computer chip manufacturing equipment's fiscal fourth-quarter earnings beat Wall Street's modest expectations.
Investors sent the stock up $2.14, or 6.8 percent, to $33.73 in afternoon trading, but analysts were less enthusiastic about the results.
Economic pressures and oversupply troubles in the memory chip market, which accounts for some of Lam's largest customers, have caused some companies to hold off on upgrading their factories.
Needham & Co. analyst Y. Edwin Mok maintained his "Hold" rating on the stock but cut his earnings forecast for the 2009 fiscal year to $1.50 per share from $2.20 per share as the company forecast weaker-than-expected shipments in the current quarter.
"We'd wait for confirmation of a memory spending rebound before revisiting our rating," he wrote.
Fremont, Calif.-based Lam indicated shipments are expected to grow significantly in the fiscal second quarter, which ends in December, but Oppenheimer & Co. analyst Gary Hsueh wasn't fully convinced.
"Our checks indicate that while the increasing order activities is likely to be true, the certainty of those orders is deteriorating as the memory sector is facing increasing demand weakness," he wrote in a research note.
Hsueh trimmed his profit outlook for the full fiscal year to $1.47 per share from $1.50 per share. |
