Even though Spreadtrum Communications (NASDAQ:SPRD) reported solid sales and earnings per share for the third quarter, Canaccord isn't convinced the guidance given by management is necessarily in line with how it'll turn out for them.
"Spreadtrum reported Q3/10 sales of $96.2M and pro forma EPS of $0.43 versus our $91.7M/$0.34 estimates. Spreadtrum management guided to revenue of $118M-125M and gross margin of 42.5-43.5% for Q4/10, well above our $97.6M/41.8% estimates. Due to continued slow growth of China TD-SCDMA unit sales and pricing pressure, we are raising our price target to $17 but maintaining our rating."
Spreadtrum closed slightly in positive territory Thursday, rising by $0.03, or 0.20 percent, to $15.39. Canaccord has a price target of $17 on them, along with a "Hold" rating.
Friday, November 19, 2010
Spreadtrum Communications (NASDAQ:SPRD) Facing Pricing Pressure and Slow China Growth
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