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Strategies & Market Trends : Guidance II -- Ignore unavailable to you. Want to Upgrade?

To: 2MAR$ who wrote (184)	2/28/2002 9:49:54 PM
From: 2MAR$	Respond to of 2077

Genesis shares take "the plunge" on outlook ..a screamer chart stockcharts.com[h,a]daclyiay[pc5!c20!f][vc60][iut!Lh5,5!La12,26,9]&pref=G By CBS.MarketWatch.com Last Update: 4:30 PM ET Feb. 28, 2002 NEW YORK (CBS.MW) - Shares of Genesis Microchip plunged 43 percent Thursday after the integrated circuit maker gave a post-merger financial outlook that disappointed investors. The stock sank $17.51 to $23.49. Late Wednesday, the company said it expects sales for its fiscal third-quarter, following the completion of its merger with Sage, would be $55 million. For the fiscal fourth-quarter, Genesis (GNSS: news, chart, profile) is anticipating sales to exceed $60 million. Analyst Robert Adams at CIBC World Markets followed by downgrading the stock to "buy" from "strong buy," and dropped his price target to $45 a share from $85 a share. He noted that the company had previously given pre-merger expectations of $50 million and $52.5 million, respectively. He said the company also indicated post-merger net earnings for the June quarter would be "accretive" relative to consensus estimates when the merger was first announced on Sept. 28. "However, our, and we assume all of Wall Street's, preconference call assumptions and recommendations were erroneously predicated on merger accretion relative to current June consensus EPS estimates (42 cents), rather than the First Call consensus on Sept. 28 (19 cents)," Adams explained in a note to clients. "Since the merger announcement, Genesis had considerably outperformed expectations, which in turn drove the June consensus to 42 cents. Unfortunately, guidance implies material dilution to current consensus estimates."