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NEW YORK -(Dow Jones)- Investors Tuesday grew pessimistic over makers
of so-called programmable logic chips after Altera Corp. said weak
orders in November will mean flat revenue in the fourth quarter.
In Tuesday morning trading, shares of Altera (ALTR) were off $10.75,
or 21%, at $40.938. Shares of other programmable-chip makers also fell.
Lattice Semiconductor Corp. (LSCC) stock was off $4.125 at $54.875.
Shares of Xilinx Inc. (XLNX) were down $4.75, or 12%, $35.688.
At least three analysts lowered their ratings on Altera. Altera
(ALTR) officials earlier had said orders in November were very weak, and
that fourth-quarter earnings will be flat unless there is a "major
recovery" in December.
In the third quarter, the San Jose, Calif.-based company had net
income of $38.8 million, or 40 cents a diluted share, on revenue of
$162.1 million. Eighteen analysts surveyed by First Call expect Altera
to earn 42 cents a share in the fourth quarter.
As a result, ABN AMRO Chicago Corp. lowered its rating on Altera to
"hold" from "buy," analyst David Wu said. Wu said he had previously
anticipated Altera would have 7% revenue growth in the fourth quarter,
but he now expects flat growth from the third quarter to the fourth.
Wu said he called Altera officials to get an explanation for its
10.4% rise in share price Monday. He said officials said the company
experienced a weak November as customers pushed out orders across "all
geographies and market segments."
Morgan Stanley downgraded Altera to "neutral" from "outperform" while
Volpe Brown Whelan downgraded the stock to "buy" from "strong buy." No
further information was available on those downgrades. |
