<A> Analog Devices Falls 4% In Sympathy With Natl Semi Drop
By Ted W. Kemp
NEW YORK (Dow Jones)--Analog Devices Inc. (ADI) shares closed 4% lower Monday as investors were spooked by comments National Semiconductor Corp. (NSM) officials made during a conference call about the Asian semiconductor market, analysts said.
Citing uncertainty in the Asia-Pacific market, National Semiconductor said early Monday it expects sales and net income to fall below analysts' expectations for the fiscal third quarter ending March 1.
National Semiconductor's NYSE-listed shares plunged 4 5/8, or 16.4%, to 23 1/2 on volume of 11.4 million, compared with a daily average of 2 million.
Analysts said Analog Devices, which makes linear, mixed signal and digital integrated circuits, followed National's lead.
The stock lost 1 3/16, or 4%, to finish at 28 5/16. Volume of 2 million shares easily surpassed average daily volume of 1.1 million.
Chris Chaney, who follows Analog for A.G. Edwards & Sons Inc., said National Semiconductor saw weakened Asian demand for power regulators, products that Analog Devices makes as well.
In particular, Taiwanese fabricators of motherboards have made recent efforts to cut back on their inventories of power regulators, Chaney said.
The analyst said communications products, which include digital signal processors and power regulators, accounted for more than 20% of Analog's total revenue in fiscal 1997 ended Nov. 1.
However, Chaney added that he could not foresee whether National's predicted revenue shortfall translated into problems for Analog.
"I can't say what the direct impact is, if there is any impact at all," he said.
Officials at Analog Devices were not immediately available for comment.
Analyst Eliot Glazer of Du Pasquier & Co. said National's conference call gave an overall impression that soft aggregate demand for analog and mixed signal semiconductors is "more pervasive than expected" and has begun to spread to Europe.
Analog, Norwood, Mass., is a major producer of these products, which account for about 30% of its revenue, Glazer said.
But he said investors should not assume weakness at National Semiconductor translates into the same problems for Analog Devices, which he thinks has a "superior" product.
In a related stock movement, Burr-Brown Corp. (BBRC), which also makes power regulators, fell 1 3/4, or 4.9%, to close at 33 11/16 on Nasdaq volume of 451,300 shares. The daily average is 191,100. |
