Chip upgrades lead tech gains
By Rex Crum, MarketWatch
Last Update: 10:27 AM ET April 6, 2005
SAN FRANCISCO (MarketWatch) - Technology stocks largely rose in early trading Wednesday as the semiconductor sector got a lift from Merrill Lynch raising its ratings on eight semiconductor stocks.
In a research note, Merrill analyst Joe Osha said the brokerage would raise its ratings on Altera Corp. (ALTR: news, chart, profile) , AMI Semiconductor (AMIS: news, chart, profile) , ATI Technologies (ATYT: news, chart, profile) , Broadcom Corp. (BRCM: news, chart, profile) and Maxim Integrated Products (MXIM: news, chart, profile) to buy from neutral. Merrill also raised its ratings on Nvidia Corp. (NVDA: news, chart, profile) , PMC-Sierra (PMCS: news, chart, profile) and Intersil Corp. (ISIL: news, chart, profile) to neutral from sell.
Osha said he expects most of the chip companies to meet their quarterly estimates for the first quarter of the year, but that lower bookings growth and backlog issues remain over the industry.
All eight shares rose in early trading. The Philadelphia Semiconductor Index ($SOX: news, chart, profile) added 1.2% to reach 415 and the Nasdaq Composite Index ($COMPQ: news, chart, profile) rose 9 points to 2,008.
Elsewhere in the tech sector, Network Appliance (NTAP: news, chart, profile) rose $1.12, or more than 4%, to $28.33. Before the market opened, IBM Corp. (IBM: news, chart, profile) said it would begin reselling various Network Appliance storage-area networking equipment in a move meant to counter EMC Corp. (EMC: news, chart, profile) .
Autodesk Inc. (ADSK: news, chart, profile) rose $1.34, or more than 4%, to $32.23. Early Wednesday, the software maker said it expects to earn 27 cents to 29 cents a share for its first quarter, with revenue in a range of $340 million to $350 million.
According to estimates compiled by Thomson First Call, analysts had been looking for earnings of 27 cents a share on revenue of $339 million.
Other tech stocks on the rise included Apple Computer (AAPL: news, chart, profile) , Hewlett-Packard (HPQ: news, chart, profile) , Microsoft Corp. (MSFT: news, chart, profile) , Sigmatel Inc. (SGTL: news, chart, profile) , Intel Corp. (INTC: news, chart, profile) and Cisco Systems (CSCO: news, chart, profile) .
Siebel Systems (SEBL: news, chart, profile) was a notable decliner, falling 78 cents, or more than 8%, to $8.38 after saying on Tuesday it expects to post results below Wall Street estimates. See full story.
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