24/7 Wall St. » MU

Micron CEO Dies In Plane Accident (MU)

Administrator — Fri, 03 Feb 2012 19:05:47 +0000

Micron Technology, Inc. (NASDAQ: MU) was halted pending news. Most investors would have assumed it was about a lawsuit or around an earnings warning. It is far worse. Micron has announced the death of its Chairman and CEO. 51-year old Steve Appleton died in a small plane accident this morning in Boise.

The company’s board of directors has noted, “Our hearts go out to his wife, Dalynn, his children and his family during this tragic time. Steve’s passion and energy left an indelible mark on Micron, the Idaho community and the technology industry at large. The company expects to provide additional information later today.”

Micron shares were halted ahead of today’s news.

The company just announced the retirement of COO Mark Durcan less than two weeks ago.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Management Change, Semiconductor, Technology Companies Tagged: MU

Potential Upside in Semiconductor Stocks (INTC, AMD, MU, BRCM, QCOM, ARMH, SNDK, ALTR, AMAT, TXN)

Paul Ausick — Mon, 23 Jan 2012 16:13:41 +0000

Since the beginning of the year the Philadelphia Semiconductor Index is up more than 13.5%. The run-up may be over for some chip makers and sustainable for others. Analysts are also a little behind in setting new price targets for the companies that have passed or are near previous target prices. Perhaps they’re just taking their time to see what happens with the earnings reports due this week.

We’ve looked 10 semiconductor companies and evaluated their chances of reaching existing price targets during the coming year. The companies are Intel Corp. (NASDAQ: INTC), Advanced Micro Devices Inc. (NYSE: AMD), Micron Technology Inc. (NASDAQ: MU), Broadcom Corp. (NASDAQ: BRCM), Qualcomm Corp. (NASDAQ: QCOM), ARM Holdings plc (NASDAQ: ARMH), SanDisk Corp. (NASDAQ: SNDK), Altera Corp. (NASDAQ: ALTR), Applied Materials Inc. (NASDAQ: AMAT), and Texas Instruments Inc. (NYSE: TXN). Data comes from Yahoo! Finance and MarketWatch.

Intel Corp. (NASDAQ: INTC) has a consensus price target of $27 and current price around $26.83, for a potential upside of about 1%. Intel reported stellar earnings last week and the stock posted a new 52-week high earlier this morning. Sales of PCs have not been as weak as feared, and margins have remained high. The new Ultrabooks, which the company is supporting with a very strong marketing budget, could really push the company substantially higher. As of this moment though, shares are fully valued.

Advanced Micro Devices Inc. (NYSE: AMD) has a consensus price target of $6.00 and a current price around $6.55, leaving no upside. The company reports earnings tomorrow and is expected to post EPS of $0.16 on revenue of $1.72 billion. The company’s shares have jumped by about a dollar in the past month, and continued improvement, especially in the server market, should push the target price higher.

Micron Technology Inc. (NASDAQ: MU) has a consensus price target of $8.75 and a current price around $8.00, for a potential upside of 9%. Last month the company’s price target was $8/share and the shares were trading at around $6.25. How much more steam can be left in Micron after that?

Broadcom Corp. (NASDAQ: BRCM) has a consensus price target of $41 and a current price around $34.92, for a potential upside of 17%. Broadcom shares have risen by more than $5/share in the last month, but unlike Micron, there’s still a lot of headroom.

Qualcomm Inc. (NASDAQ: QCOM) has a median price target of $67 and a current price around $58.60, for a potential upside of 14%. Qualcomm shares have gained more than 7% in the first three weeks of the year and the share price is up more than $4. The company has a firm position in the mobile device market and the company should continue to post growth in 2012.

ARM Holdings plc (NASDAQ: ARMH) has a consensus price target of $33.75 and a current price around $27.75, for a potential upside of more than 22%. ARM’s target price has jumped by nearly $7/share in the past month, but it is trading at nearly the same price as a month ago. Shares gained nearly 35% in the past year, but royalty payments are falling. For the year-to-date, shares are slightly down. To hit its new target, ARM has to get going.

SanDisk Corp. (NASDAQ: SNDK) has a consensus price target of $59.50 and a current price around $51.87, for a potential upside of 14.7%. SanDisk’s shares are up about 5.5% so far this year after a nearly flat 2011. Apple’s recent acquisition of of a NAND maker could sharply curtail SanDisk’s sales of the chips for iPhones and iPads.

Altera Corp. (NASDAQ: ALTR) has a consensus price target of $43 and a current price around $39.90, for a potential upside of 7.8%. Altera’s price target has been raised in the past month, and the company’s share price is also higher. Shares have risen more than 7% year-to-date, and the company is expected to report EPS of $0.42 and revenue of $447.52 million tomorrow.

Applied Materials Inc. (NASDAQ: AMAT) has a median price target of $13 and a current price around $12.29, for a potential upside of 5.8%. AMAT’s shares have jumped more than 15% since the beginning of January, and the price target has not changed. There’s not a lot to like here as far as expected upside goes.

Texas Instruments Inc. (NYSE: TXN) has a consensus target price of $34 and a current price around $33.42, for a potential upside of less than 2%. TI is expected to report EPS of $0.39 and revenue of $3.25 billion after the market closes today. The company lowered estimates in December, and there’s a decent chance TI will beat those lowered expectations. If so, a new target nearer the company’s 52-week high of $36.71 would be in order. That could raise upside potential to around 12%.

In the last month, Intel has essentially hit its target price, and because the target hasn’t been raised, there could be some question among analysts about the staying power of the recent rise. Broadcom and Qualcomm offer the best bets to post share price gains, and the targets for both are well within reach.

Paul Ausick

Filed under: Earnings, Industry, Semiconductor, Semiconductors, Technology Tagged: ALTR, AMAT, AMD, ARMH, BRCM, INTC, MU, QCOM, SNDK, TXN

Upside in Top Semiconductor Stocks for 2012 (INTC, AMD, MU, BRCM, QCOM, ARMH, SNDK, ALTR, AMAT, TXN)

Paul Ausick — Thu, 29 Dec 2011 17:30:49 +0000

Shares in semiconductor stocks have gained and lost value in about equal number during 2011. The run-up in share prices may be over for some and sustainable for others. For stocks that lost value during the year, gains in 2012 may be difficult to come by as the overall market for semiconductors has been getting softer as the new year gets closer.

Intel Corp. (NASDAQ: INTC) has a consensus price target of $27 and current price around $24.47, for a potential upside of 10.3%. Intel has put a lot of marketing muscle behind its Ultrabook design, with more models to come from more manufacturers in 2012. A new version of the Windows operating system is also due in late summer that should help with Ultrabook sales. Intel still hasn’t come up with a strategy to attack the mobile device market, and while that won’t be fatal, it could weigh on revenue and profits next year unless the Ultrabook is a blowout success.

Advanced Micro Devices Inc. (NYSE: AMD) has a consensus price target of $6.20 and a current price around $5.36, for a potential upside of 15.7%. AMD’s share price fell more than -33% in the past 12 months. The company introduced a new high-speed graphics chip recently that has been well-received. AMD’s server market share is wobbly though, although it has made progress in notebooks. But expecting a gain of more than 15% seems like wishful thinking.

Micron Technology Inc. (NASDAQ: MU) has a consensus price target of $8 and a current price around $6.24, for a potential upside of 28.2%. Micron’s shares jumped last week on a weak earnings report primarily on the basis of more expected consolidation in the DRAM market. Pricing has been weak for DRAM chips, but Micron is in a better position than most competitors to be among the survivors. Still, a lot of things need to go right for the company to hit its price target.

Broadcom Corp. (NASDAQ: BRCM) has a consensus price target of $41 and a current price around $29.53, for a potential upside of 38.8%. Broadcom has posted strong revenue and profit growth in 2011, but its share price has fallen by about -32%. Revenue and profit are both expected to continue growing in 2012, and the company is not a bad bet to hit its current price target.

Filed under: Analyst Calls, Industry, Semiconductor, Semiconductors, Technology, Technology Companies Tagged: ALTR, AMAT, AMD, ARMH, BRCM, INTC, MU, QCOM, SNDK, TXN

24/7 Wall St. Closing Bell (POT, AGU, SKS, VVUS, MU, AM, CPY, NEOG, TIBX, BBBY, RAM, WCAA, ABIO, PHH, LRE)

Paul Ausick — Thu, 22 Dec 2011 21:07:33 +0000

A downward revision to third-quarter GDP did not hold down early trading this morning as markets got off to a good start and remained in positive territory throughout the day. A rise in consumer confidence and in leading economic indicators likely solidified the gains. Trading volume was light again today in the run-up to the holiday weekend. WTI crude traded at $99.46/barrel and Brent traded at $107.73. Gold continues to slide, down -$5.80, at $1,607.80/ounce.

The unofficial closing bells put the DJIA up more than 63 points to 12,170.86 (0.52%), the NASDAQ rose more than 21 points (0.83%) to 2,599.45, and the S&P 500 rose 0.83% or more than 10 points to 1,254.07.

There were several analyst upgrades and downgrades today, including Potash Corp. of Saskatchewan (NYSE: POT) raised from ‘sector perform’ to ‘outperform’ at RBC Capital Markets. Other ratings actions today include Agrium Corp. (NYSE: AGU) cut from ‘outperform’ to ‘sector perform’ at RBC Capital Markets; Saks Inc. (NYSE: SKS) cut from ‘outperform’ to ‘neutral’ at Zack’s; Vivus Inc. (NASDAQ: VVUS) cut from ‘buy’ to ‘neutral’ at Roth Capital and maintained ‘outperform’ at Credit Suisse; and Micron Technology Inc. (NASDAQ: MU) maintained as ‘buy’ with an $11 target price at Sterne Agee and maintained as ‘outperform’ at Credit Suisse.

Here are some of last night’s and today’s post-earnings news reactions with prices during the last half-hour of trading: Micron Technology is up nearly 18% at $6.54; American Greetings Inc. (NYSE: AM) is down more than -21% at $13.37, after posting a new 52-week low of $12.85 earlier in the day; CPI Corp. (NYSE: CPY) is down more than -62% at $2.00, after posting a new 52-week low of $1.96 earlier in the day; Neogen Corp. (NASDAQ: NEOG) is down nearly -3% at $31.15; Tibco Software Inc. (NASDAQ: TIBX) is up nearly 8% at $23.74; and Bed Bath & Beyond Inc. (NASDAQ: BBBY) is down more than -6% at $57.70.

Other standouts from today include the following stocks:

RAM Energy Resources Inc. (NASDAQ: RAM) is up nearly 71% at $1.88. The independent oil & gas company has today relisted on the NASDAQ and has also announced a $550 million investment from a private equity firm headed by the former chairman and CEO of Petrohawk.

WCA Waste Corp. (NASDAQ: WCAA) is up nearly 31% at $6.43, after posting a new 52-week high of $6.44 earlier. The non-hazardous waste processor has approved a cash buyout offer for $526 million ($6.50/share) from a private investment fund.

ARCA biopharma Inc. (NASDAQ: ABIO) is down more than -24% at $1.02, after posting a new 52-week low of $0.97 earlier today. The biopharmaceutical firm announced a private placement of $1.75 million in stock and warrants.

PHH Corp. (NYSE: PHH) is down more than -15% at $11.01 after posting a new 52-week low of $8.75 earlier today. The mortgage servicer’s credit ratings were cut at S&P to ‘BB-’ on concern that the company would not be able to make a $423 million debt repayment scheduled for March 2013 out the its free cash flow.

Vivus Inc. (NASDAQ: VVUS) is down more than -16% at $8.72 after posting a new 52-week low of $8.60 earlier. The biopharmaceutical firm announced that its weight-loss drug Qnexa led to a higher rate of birth defects in children whose mothers were taking the drug during pregnancy.

LRR Energy, L.P. (NYSE: LRR) is up more than 9% at $19.34. The independent oil & gas company has received positive ratings from several brokers following last week’s more than 9 million new common units.

Stay tuned for Friday. Here are the noteworthy events on the schedule (all times Eastern):

8:30 a.m. – Durable goods orders report
8:30 a.m. – Personal income and spending report
10:00 a.m. – New home sales

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: ABIO, AGU, AM, BBBY, CPY, LRE, MU, NEOG, PHH, POT, RAM, SKS, TIBX, VVUS, WCAA

Top Ten Analyst Upgrades & Downgrades (AGU, BLX, GNW, HBC, JEF, MU, NSC, POT, SKS, VVUS)

Administrator — Thu, 22 Dec 2011 13:27:15 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Thursday morning.

Agrium Inc. (NYSE: AGU) Cut to Sector Perform from Outperform at RBC Capital Markets.
Banco Latinoamericano de Comercio Exterior, S.A. (NYSE: BLX) named as value stock of the day at Zacks Investment Research.
Genworth Financial Inc. (NYSE: GNW) Downgraded to Underperform from Neutral at Zacks Investment Research.
HSBC Holdings PLC (NYSE: HBC) maintained Underperform but also named as Bear of the Day at Zacks Investment Research.
Jefferies Group, Inc. (NYSE: JEF) Cut to Hold from Buy by Meredith Whitney (Late-Wednesday call).
Micron Technology, Inc. (NASDAQ: MU) Maintained Buy with $11 target at Stern Agee; maintained as Outperform at Credit Suisse.
Norfolk Southern Corporation (NYSE: NSC) maintained Outperform as Bull of the Day at Zacks Investment Research.
Potash Corp. of Saskatchewan (NYSE: POT) Raised to Outperform from Sector Perform at RBC Capital Markets.
Saks Inc. (NYSE: SKS) Downgraded to Neutral from Outperform at Zacks Investment Research.
VIVUS, Inc. (NASDAQ: VVUS) Cut to Neutral from Buy at Roth Capital; Maintained as Outperform at Credit Suisse.

JON C. OGG

Filed under: Analyst Calls Tagged: AGU, BLX, GNW, HBC, JEF, MU, NSC, POT, SKS, VVUS

Intel Warning Knock… Market Inefficiency Reigns (INTC, TXN, ALTR, WDC, SMH, AMD, MU)

Administrator — Mon, 12 Dec 2011 14:23:34 +0000

Intel Corporation (NASDAQ: INTC) may be a recent position added to the Berkshire Hathaway Inc. (NYSE: BRK-A) stock holdings portfolio, but the semiconductor and processor giant is now issuing an earnings warning. If you have been tracking the news out of Texas Instruments Inc. (NYSE: TXN), Altera Corporation (NASDAQ: ALTR), and Western Digital Corporation (NYSE: WDC), today’s news might not seem like such a surprise. What matters is that the condition is expected to remain.

Intel said that its key fourth-quarter results “are expected to be below the company’s previous outlook due to hard disk drive supply shortages.” The new fourth-quarter revenue target is $13.7 billion, plus or minus $300 million. The prior target had been $14.7 billion, plus or minus $500 million.

Where this gets interesting is that Intel says personal computer sales will be up sequentially but that the worldwide PC supply chain is reducing inventories and microprocessor purchases as a result of hard disk drive supply shortages. Analysts had been warning about this last week and before for both Intel and the rest of the PC and semiconductor chain.

Unfortunately, Intel said that it expects hard disk drive supply shortages to continue into the first quarter. The current expectation is that there will then be a rebuilding of microprocessor inventories as supplies of hard disk drives recover during the first half of 2012.

The Semiconductor HOLDRs (NYSE: SMH) is trading down nearly 2% on the news out of Intel this morning, while Advanced Micro Devices, Inc. (NYSE: AMD) is down 2% at $5.42 right before the open. Micron Technology Inc. (NASDAQ: MU) is down 2.2% at $5.76 in the pre-market.

Gross margin is now put at 64.5%, plus or minus 2%, versus the prior forecast of 65% (plus or minus 2%); non-GAAP gross margin is expected to be 65.5% (+/- 2%) versus a prior target of 66% (+/- 2%).

Intel also noted that its earnings and news quiet period will begin on December 16 and that its earnings will be released on January 19, 2012.

Shares of Intel had been at $25.01 and its 52-week trading range is $19.16 to $25.78. The pre-market trading is showing a drop of 3.2% at $24.20. The market had been given warnings of this but no one ever seems to want to admit that just because a sector is slowing and has high supply problems that a warning will still come. Had more warnings from analysts (and chip peers) in recent days and weeks not been given out, then the reaction may have been far worse.

JON C. OGG

Filed under: Earnings Warning, PC Companies, Semiconductor, Technology Companies Tagged: ALTR, AMD, INTC, MU, SMH, TXN, WDC

Top Analyst Upgrades & Downgrades (AET, BIG, CIT, FMCN, GILD, JASO, LDK, MDR, MU, SNH, VE, INT)

Administrator — Wed, 23 Nov 2011 13:02:43 +0000

These are some of Wednesday’s top analyst upgrades, downgrades, and initiations seen from Wall Street research calls.

Aetna, Inc. (NYSE: AET) named Bull of the Day at Zacks.
Big Lots Inc. (NYSE: BIG) Cut to Equal-Weight at Barclays.
CIT Group Inc. (NYSE: CIT) Started as Hold at Jefferies.
Focus Media Holding Ltd. (NASDAQ: FMCN) Cut to Neutral at JPMorgan.
Gilead Sciences Inc. (NASDAQ: GILD) Cut to Hold at Argus.
JA Solar Holdings Co., Ltd. (NASDAQ: JASO) Cut to Sell at ThinkEquity.
LDK Solar Co., Ltd. (NYSE: LDK) Cut to Sell at ThinkEquity.
McDermott International (NYSE: MDR) named as Bear of the Day at Zacks.
Micron Technology Inc. (NASDAQ: MU) Raised to Buy at Citigroup.
Senior Housing Properties Trust (NYSE: SNH) Raised to Buy at Stifel Nicolaus.
Veolia Environnement S.A. (NYSE: VE) Raised to Overweight at HSBC.
World Fuel Services Corporation (NYSE: INT) named value stock of the day at Zacks.

JON C. OGG

Filed under: Analyst Calls Tagged: AET, BIG, CIT, FMCN, GILD, INT, JASO, LDK, MDR, MU, SNH, VE

Top Analyst Upgrades & Downgrades (ADSK, CCL, CHK, ENB, LEG, LULU, MU, NTAP, PRGO, QCOM, RCL, TD, TA)

Administrator — Thu, 17 Nov 2011 13:22:14 +0000

These are some of Thursday’s top analyst upgrades, downgrades, and initiations seen from Wall Street research calls.

Autodesk Inc. (NASDAQ: ADSK) Raised to Buy with $47 target at Argus.
Carnival Inc. (NYSE: CCL) Started as Neutral at HSBC.
Chesapeake Energy Corporation (NYSE: CHK) Cut to Sell at Argus.
Enbridge Inc. (NYSE: ENB) Raised to Buy at TD.
Leggett & Platt, Inc. (NYSE: LEG) named Bear of the Day at Zacks.
Lululemon Athletica Inc. (NASDAQ: LULU) Raised to Buy at Stifel Nicolaus.
Micron Technology Inc. (NASDAQ: MU) Raised to Outperform at Oppenheimer; Reiterated Outperform and raised target to $12 at Credit Suisse.
NetApp Inc. (NASDAQ: NTAP) Cut to Neutral at Collins Stewart; Maintained Outperform but estimates cut at Credit Suisse.
Perrigo Company (NASDAQ: PRGO) named Bull of the Day at Zacks.
QUALCOMM Incorporated (NASDAQ: QCOM) Reiterated Buy with $74 target at Canaccord Genuity.
Royal Caribbean Cruises Ltd. (NYSE: RCL) Started as Neutral at HSBC.
Toronto Dominion Bank (NYSE: TD) Cut to Market Perform at KBW.
TravelCenters of America LLC (AMEX: TA) named as Value stock of the day at Zacks.

JON C. OGG

Filed under: Analyst Calls Tagged: ADSK, CCL, CHK, ENB, LEG, LULU, MU, NTAP, PRGO, QCOM, RCL, TA, TD

Media Digest (11/17/2011) Reuters, WSJ, NYTimes, FT, Bloomberg

247wallst — Thu, 17 Nov 2011 11:08:22 +0000

The super committee makes no significant decisions on the budget deficit. (Reuters)

The largest shareholder in Olympus cuts its position. (Reuters)

Google (NASDAQ: GOOG) launches its new music service. (Reuters)

Germany and France disagree about the role of the European Central Bank in the sovereign debt crisis. (Reuters)

SABMiller expects difficulty with sales due to slow business in the U.S. and EU. (Reuters)

BHP Billiton (NYSE: BHP) lowers its forecasts. (Reuters)

Greece starts talks with private bondholders. (Reuters)

PepsiCo (NYSE: PEP) directors may split the company into separate food and soda operations. (Reuters)

The head of Aol’s (NYSE: AOL) applications group quits. (WSJ)

Europe’s banks may have trouble with capital. (WSJ)

Fitch warns that U.S. banks may be more exposed to the EU debt crisis than expected. (WSJ)

General Electric (NYSE: GE) starts a $1 billion software program to make products and services more efficient. (WSJ)

Rambus (NASDAQ: RMBS) loses a major antitrust case against Micron (NASDAQ: MU) and Hynix. (WSJ)

Fees that Newt Gingrich earned from Freddie Mac have drawn negative media attention. (WSJ)

Demands grow for the ECB to help resolve the eurozone debt crisis. (WSJ)

Sales at Sears Holdings’ (NYSE: SHLD) Kmart and Sears stores hurt by slow remodeling. (WSJ)

Abercrombie & Fitch (NYSE: ANF) hurt by its need to lower prices. (WSJ)

Delphi Automotive sets its share prices at $22. (WSJ)

AMR (NYSE: AMR) and its pilots will return to the bargaining table. (WSJ)

Germany’s public sector lenders downgraded by Moody’s. (WSJ)

China increases its Treasury holdings as some eurozone paper becomes more risky. (WSJ)

A number of alternatives to oil may be lost if the Keystone XL pipeline loses support. (NYT)

Central banks sharply increase gold holdings. (FT)

The U.S.-China Economic and Security Review Commission says yuan manipulation could undermine the dollar as the world’s currency. (FT)

AT&T (NYSE: T) may sell the Nokia (NYSE: NOK) Microsoft (NASDAQ: MSFT) Windows smartphone. (Bloomberg)

Douglas A. McIntyre

Filed under: Press Digest Tagged: AMR, ANF, AOL, BHP, GE, GOOG, MSFT, MU, NOK, PEP, RMBS, SHLD, T

Applied Gets Deeper Into Client Base With Varian Buyout Nod (AMAT, VSEA, INTC, IBM, MU)

Administrator — Mon, 07 Nov 2011 19:42:36 +0000

Applied Materials Inc. (NASDAQ: AMAT) has just submitted a SEC filing disclosing that the Chinese Ministry of Commerce has now approved its acquisition of Varian Semiconductor Equipment Associates, Inc. (NASDAQ: VSEA). The merger goes back to May 3 and this was the last of the needed regulatory approvals to close upon the $63.00 per share in cash merger.

Applied expects to close the merger on November 10, 2011. The world’s largest equipment maker for semiconductor manufacturing paid a 55% premium back when its own stock was closer to $15.00 versus about $12.35 today. The company cannot be blamed for the market, but Applied Materials certainly did not heed the “sell in May and go away!” creed. If it had, perhaps the deal could have been done for 10% or even 20% less depending upon whether or not Varian’s management would have been willing to sell at market-adjusted prices.

Applied has claimed that the acquisition will lift earnings per share within a year as well as adding in $60 million in annual savings after Applied integrates Varian’s ion implantation gear that is used in making chips or integrated circuits for consumer electronics. Our latest figures show that this may be about 5% of the wafer fabrication equipment market of $35 billion.

This merger was Applied’s largest-ever acquisition and the goal was to gain market share for higher performance chips. It can also be considered a buy that goes deeper into solar, as well as display and light-emitting diodes.

Varian’s key customers were previously reported as Intel Corporation (NASDAQ: INTC) and IBM (NYSE: IBM), as well as Micron Technology Inc. (NYSE: MU), and key players like GlobalFoundries, Hynix, and others. Another merger is done, now comes the integration.

JON C. OGG

Filed under: Mergers and Buy Outs, Semiconductor Tagged: AMAT, IBM, INTC, MU, VSEA