Ratings on (SMSI) (SUNH) (TMH) Downgraded by Analysts

Analysts downgraded ratings on Smith Micro Software, Inc. (NASDAQ: SMSI), Sun Healthcare Group, Inc. (NASDAQ: SUNH) and Team Health Holdings (NYSE: TMH) today.

Needham & Company downgraded Smith Micro Software, Inc. (SMSI) from a “buy” rating to a “hold” rating.

Citigroup (NYSE:C) downgraded Sun Healthcare Group, Inc. (SUNH) from a “buy” rating to a “hold” rating. They have a price target of $12.00 on the company, down from $17.00.

Citigroup downgraded Team Health Holdings (TMH) from a “buy” rating to a “hold” rating. They have a price target of $23.00 on the company, up from $20.00. They cited valuation as the catalyst behind its call.

Apple (NASDAQ:AAPL) PT Boosted by Needham, Susquehanna

With sales of Apple's (NASDAQ:AAPL) iPad and iPhone appearing to be higher than expected, analysts at Needham & Co. and Susquehanna raised their price target on the company even more.

Needham analyst Charlie Wolf wrote, "Our forecast of the iPad’s ultimate share of the media table market is materially higher than the forecasts of most pundits. In our opinion, that’s because they’re confusing the media tablet market with the smartphone market. Sales of smartphones ... have been driven by the carriers who can turn the phones into revenue producers by loading them with their own content, software and services (colloquially referred to as “crapware”). However, carriers should play a far more limited role in the distribution of tablets, because tablets are primarily content consumption, not communications devices. We believe the media tablet market will more closely emulate the portable music player market, where the iPod continues to dominate, than the smartphone market."

Wolf sees Apple selling about $75 million iPhones in 2011. Over the next five years he believes their current market share of 16 percent will rise to 22 percent.

Needham maintains a "Buy" rating on Apple, which was trading at $352.33, gaining $5.83, or 1.68 percent, as of 2:40 PM EST. Wolf raised his price target on Apple from $375 to $450.

Susquehanna boosted their price target on Apple from $445 to $465.

Varian Semiconductor's (NASDAQ:VSEA) Core Semi Business Driving Growth

Varian Semiconductor (NASDAQ:VSEA) remains the top pick of Needham in their sector, driven by several catalysts, including a growing core semi business.

Needham says, "VSEA reported a solid F1Q11 (Dec) quarter and provided substantially better than expected guidance. VSEA remains our top mid/large-cap pick in the space, based on our thesis that: 1) new implant applications are driving its core semi business to outgrow WFE over the next few years; 2) VSEA is the best name levered to foundry and logic capex growth in 2011; 3) solid traction in its emerging solar business will drive upside to revenue targets; and 4) the stock warrants a premium multiple based on strong earnings growth potential...We are raising our FY11 (Sep) non-GAAP EPS estimate to $4.00 and FY12 to $4.35 on higher revenue estimates."

Needham & Company maintains a "Buy" rating on Varian Semiconductor (VSEA), which was trading at $43.53, down $0.01, or 0.02 percent, as of 2:25 PM EST. Needham raised its price target on Varian from $48 to $57.

Anaren (NASDAQ:ANEN) Top, Bottom Line Growth Looks Solid for 2011

Citing opportunities in its S&D and Wireless businesses, Needham sees top and bottom line growth strong for Anaren (NASDAQ:ANEN) in 2011.

Needham says, "Anaren delivered solid 2QF11 results, with upside mitigated by a facility expansion, which we nonetheless view as an encouraging sign. With strong demand in its higher margin Wireless business and a historically high level of opportunity in its S&D business, we think the company is positioned to show solid top and bottom line growth...Our forward estimates are largely unchanged for F2011 and F2012, though we introduce C2012 estimates of $201MM and $1.50 NG EPS. We have left the potential reduction in reported R&D expense referenced above as potential upside to our model."

Needham & Company maintains a "Buy" rating on Anaren (ANEN), which was trading at $20.89, down $0.27, or 1.28 percent, as of 1:53 PM EST. Needham boosted their price target on Anaren from $22 to $24.

LeCroy's (NASDAQ:LCRY) January Orders Coming in at Record Pace

LeCroy (NASDAQ:LCRY) not only turned in a sold second quarter, with bookings growing at a 35 percent clip, but they're also receiving orders in January at record levels.

Needham says, "LCRY turned a stellar FQ2 report yesterday after preannouncing better than expected results ahead of the company's recent presentation at the Needham Growth Conference. Bookings rose 35% y/o/y, and orders thus far in January are on a record pace. Mgmt raised full-year guidance, citing broad-based strength in the mid-range and high-end segments of the scope market and across its major geographic regions. Given the current demand environment, we believe there is further upside to operating margins over and above mgmt's latest guidance.

"We are raising our non-GAAP EPS estimate for FQ3 to $0.30 from $0.25 on revenues of $45.6M. We are raising our F11 EPS estimate to $1.09 from $1.00 on revenues of $176M and have increased our F12 EPS estimate to $1.20 from $1.15 on revenues of $193M."

Needham & Company maintains a 'Buy' rating on LeCroy (LCRY), which closed Thursday at $13.37, down $0.08, or 0.59 percent. Needham raised their price target on LeCroy from $16 to $17.

Aggressively Accumulate Integrated Silicon Solution (NASDAQ:ISSI) Shares Says Needham

Even though Integrated Silicon Solution (NASDAQ:ISSI) reported a strong quarter and gave solid guidance, Needham believes they're even better than that, and recommends buying up shares of the company aggressively.

Needham says, "We are raising our price target on ISSI to $15 and introducing our FY12 Non-GAAP estimates. While ISSI indeed reported a solid quarter and guidance, we believe the long term fundamentals of the company are poised to improve materially. The inventory correction in the commodity DRAM market is largely behind the company and we believe the backlog across ISSI’s key markets (i.e. auto/telecom/networking) is strengthening. Moreover, the company’s acquisition of Si En, a supplier of higher performance mixed signal circuits for the consumer market, helps diversify the company’s revenues and improves its overall blended gross margins. We believe ISSI’s gross margin profile is an upward trajectory with the acquisition of Si En and the divestiture of lower margin Giantec. With the shares trading at less than 5x our FY12 Non-GAAP EPS, excluding the cash, we recommend investors aggressively accumulate shares at current levels.

"We are increasing our FY11 Non-GAAP EPS to $278.5MM/$1.25 (vs. $267.8MM/$1.13). We are also introducing our FY12 Non-GAAP EPS ests of $320.0MM/$1.60."

Needham & Company reiterates a "Buy" rating on Integrated Silicon Solution (ISSI), which closed Thursday at $10.94, gaining $1.01, or 10.17 percent. Needham raised their price target on ISSI from $12 to $15.

Cohu's (NASDAQ:COHU) GM Weakness Driving EPS Down

Cohu (NASDAQ:COHU) gave low guidance from its GM exposure, falling close to 34 percent, resulting in Needham lowering their EPS estimate on them.

Needham says, "The semi equipment orders dropped 9% Q/Q and the semi equipment book-to-bill was 0.88. Revenue guidance for Q4 was to the range of $85-90M or a 10% decline Q/Q. This is in line with our revenue estimate. However, the GM guide of flat at about 34% is below our expectation and is expected to carry thorough mid-2011. This was due to a delay in taking manufacturing steps offshore from the Poway, CA facility for mostly the Pyramid handler. We adjusted our 2011 revenue/EPS from $323M/$1.75 to $326M/$1.55 and introduced our 2012 revenue/EPS at $319M/$1.70."

Needham & Company maintains a "Buy" rating on Cohu (COHU), which closed at $15.18, losing $1.48, or 8.88 percent. Needham lowered their price target on Cohu from $21 to $20.

Quantum Corp. (NYSE:QTM) Hammered on Q3 Results, Needham Still Likes Them

While third quarter results for Quantum Corp. (NYSE:QTM) were underwhelming, Needham continues to recommend, Quantum, believing they've made made major improvement.

Needham says, "QTM is focused on its core vision of protecting and managing data from edge to core employing a single scalable disk-based architecture (with de-dup. and replication) and tightly integrating tape. Despite a disappointing F3Q, QTM has made solid progress improving its balance sheet/cash flow, enhancing profitability, improving its Disk/software portfolio and building out its disk oriented channel - positioning QTM for resumption of growth...Given uncertainty, we are reducing our F12 disk/software estimate to $168M from $227M."

Needham & Company reiterates a "Buy" rating on Quantum Corp. (QTM), which was trading at $2.95, losing $0.64, or 17.83 percent, as of 1:53 PM EST. Needham raised their price target on Quantum from $4 to $4.50.

Super Micro Computer's (NASDAQ:SMCI) Macro Continues to Improve

Super Micro Computer (NASDAQ:SMCI) continues to take share as it grows quicker than the server market, as its macro improves.

Needham says, "SMCI sees strong customer interest in its approach from segments including server farms, certain verticals with complex computing requirements and OEMs. SMCI is benefiting from improving macro, Nehalem based server refresh, and other new product launches. It is targeting operating model of 9-12% (vs. 7.8% in F2Q). SMCI is growing significantly faster than server market while also taking share."

Needham & Company reiterates a "Buy" rating on Super Micro Computer (SMCI), which closed Wednesday at $13.64, gaining $0.61, or 4.68 percent. Needham raised their price target on Super Mircro from $17 to $18.

Polypore International's (NYSE:PPO) Gross Margins Better Than Expected

Polypore International (NYSE:PPO) appears to have placed themselves in the position of producing another solid quarter, and it doesn't hurt that gross margins are better than believed.

Needham says, "We believe Polypore is positioned to deliver another solid year of financial performance. The major businesses are positioned to benefit from better demand and ongoing capacity expansion efforts. In our view, there 'ain't no dogs in the company's portfolio of businesses...We are increasing our 4Q10 operating EPS estimate to $0.35 (from $0.33) and our FY11 EPS estimate to $1.71 (from $1.54) to reflect a better gross margin profile than initially anticipated."

Needham & Company maintains a "Strong Buy" on Polypore International (PPO), which closed Wednesday at $47.49, up $2.62, or 5.84 percent. Needham raised their price target on Polypore from $38 to $50.

II-VI Inc (Nasdaq:IIVI) Scores Another Strong Quarter

II-VI Incorporated (Nasdaq:IIVI) generated another solid performance in their latest quarter, increasing revenues by 76 percent, and EPS by 213 percent.

Needham says, "IIVI prior to the market open yesterday (Tuesday) delivered another superb quarterly report, highlighted by a 76% y/o/y increase in FQ2 revenues, 213% y/o/y growth in EPS and a 71% increase in bookings. The strength was broadly based across the company's commercial and military markets.

"We are raising our F11 revenue estimate to $485M from $453.8M and EPS estimate to $2.20 from $2.00. We are increasing our F12 EPS estimate to $2.50 from $2.20 on revenues of $525M, up from $497M previously."

Needham & Company maintains a "Buy" rating on II-VI, Inc. (IIVI), which closed Wednesday at $49.59, gaining $1.09, or 2.25 percent. Needham raised their price target on II-VI from $44 to $54.

Hutchinson Technology (NASDAQ:HTCH) Still A Couple of Years Away from EPS Breakeven

Saying Hutchinson Technology (NASDAQ:HTCH) is at best still a couple of years away from EPS breakeven, Needham recommends staying on the sidelines with this one for now.

Needham says, "Although there were some bright spots in F1Q (such as yield improvements for TSA+, qualification by a customer for the new Thailand facility, and a smaller drag from the Biomeasurement business) times remain challenging for Hutchinson. The company needs to achieve roughly $92-95M in revenue for operating breakeven and -$100M for EPS breakeven, which we estimate MIGHT be possible by the end of F12. Consequently, we continue to take a cautious Hold stance on the stock as this drama unfolds."

Needham & Company reiterates a "Hold" rating on Hutchinson Technology (HTCH), which closed Wednesday at $3.41, gaining $0.20, or 6.23 percent.

RF Micro Devices (NASDAQ:RFMD) Crushed on Nokia (NYSE:NOK) Share Loss

Shares of RF Micro Devices (NASDAQ:RFMD) were getting hit hard today on increasing share loss at Nokia (NYSE:NOK).

Needham says, "A worse-than-seasonal (10%-15%) decline in the core business due to further share loss at Nokia (NYSE: NOK) is compounded by a $25MM Q/Q decline in the transceiver business. GM was guided flat to down 200bps due to lower utilization, lower 3G revenue and the ramp of PowerSmart. We are subsequently lowering our F4Q11 revenue and non-GAAP EPS to $220.0MM/$0.08 from $253MM/$0.15 and compared with the consensus of $259.3/$0.15.

"We will wait through the estimate-reset and until the ramp of PowerSmart lends increased visibility before turning more positive on shares."

Needham & Company maintains a 'Hold' rating on RF Micro Devices (RFMD), which was trading at $7.01, losing $0.65, or 8.55 percent, as of 2:45 PM EST.

Time Warner Cable (NYSE:TWC) Rev, EPS Estimates Raised on Increased Share Repurchase

Time Warner Cable (NYSE:TWC) had its revenue and EPS estimates raised by Needham, citing a larger share repurchase than expected, as well as lower expenses.

Needham says, "(For Q4) We are raising our revenue estimate for FY2011 by 0.1% to $19.502B and EPS by $0.18 to $4.45 to reflect a larger share repurchases than previously projected. We are also lowering our expense estimates to reflect trends in 3Q10 that we expect to continue in FY11E."

Needham & Company reiterates a "Buy" rating on Time Warner Cable (TWC), which closed Tuesday at $67.90, up $0.20, or 0.30 percent. Needham raised their price target on Time Warner Cable from $65 to $80.

Sanmina-SCI (NASDAQ:SANM) Growth Driven by Multiple Catalysts

Sanmina-SCI (NASDAQ:SANM) is poised to enjoy strong growth in 2011, based on a pipeline of catalysts in a number of company segments.

Needham says, "Overall, Sanmina continues to be well positioned to demonstrate solid growth this year through a healthy pipeline of new wins in spaces such as Medical, Communications, Enterprise Computing & Storage and further aided by the acquisition of BreconRidge. We believe the company is executing well on and improved cost structure, and we further remain of the opinion that volume returning to components (in 2HF11) should drive healthy leverage and earnings growth in the model.

"Only minor changes to estimates. F2Q11 becomes $1.645B in revs. and $0.41. vs, prior $1.650B and $0.41. F11 now $6.86B and $1.86, vs. previous $6.86B & $1.83."

Needham & Company reiterates a "Buy" rating on Sanmina-SCI Corp. (SANM), which closed Tuesday at $14.77, gaining $0.70, or 4.98 percent. Needham has a price target on Sanmina-SCI of $19.

Financial Engines (NASDAQ:FNGN) Has Strong, Defensive Moat Says Needham

Financial Engines (NASDAQ:FNGN) has a strong business model which makes it difficult for competitors to enter into their market, according to Needham & Company.

Needham says, "Financial Engines is an investment advisor with a unique business model that enables the company to personalize investment advice for its customers and to operate in a segment of the market where potential competitors would find it difficult to operate profitably. We expect Financial Engines to continue to enjoy best-in-class growth and for FNGN shares to reach $30 within the next 12 months."

Needham & Company reiterates a 'Buy' on Financial Engines (FNGN), which closed Thursday at $24.10, up $0.19, or 0.79 percent. Needham raised their price target on Financial Engines from $20 to $30 a share.

Needham Positive on Seagate Technology (NASDAQ:STX)

Citing a number of factors, Needham & Company said they remain positive with their outlook on Seagate Technology (NASDAQ:STX).

Needham says, "We remain positive on Seagate given: 1) leading position for the next areal density transition; 2) significant buyback in place with material dividend yield possible; 3) placement at epicenter of increased IT spending for 2011; and 4) significant upside to current estimates after conservative industry guides...For F3Q, we forecast $2.67B and $0.25. F11 becomes $10.6B and $1.14 vs. $10.7B and $1.40 (mostly due to taxes - $0.06, interest - $0.06 plus the $0.09 hit from the one-time item in F2Q). F12 becomes $11.2B and $2.43, vs. our previous $11.8B and $2.35."

Needham & Company maintains a "Strong Buy" rating on Seagate Technology (STX), which was trading at $13.04, losing $1.09, or 7.71 percent, as of 1:11 PM EST. Needham has a price target of $19 on Seagate.

Tri-Tech Holding (NASDAQ:TRIT) Would Expand with New Auditor

Tri-Tech Holding (NASDAQ:TRIT) has been getting some some small contract victories, but according to Global Hunter, they could expand far greater if they upgraded their auditor to one of the top ten firms.

Global says, "We had attributed a discount of about 40% relative to US and European listed peers for two primary reasons: first, TRIT is a small cap company relative to large cap industry peers and second, this is a US listed Chinese small cap company at a time when its comparable listing universe has been under intense scrutiny. Shares have quickly surpassed our $14 target while the company has had both positive fundamental announcements related to new, albeit, small contract wins as well as management’s recent presentations to the investment community. As a result of the recent announcements we are adjusting our estimates slightly higher and are increasing our price target from $14 to $16. We would like to see the company upgrade its auditor to a top 10 recognized auditing firm, and we believe that this is likely to occur after the company files its 10-K. If this were to occur, we believe the stock would receive multiple expansion from current levels."

Global Hunter Securities reiterates a "Buy" rating on Tri-Tech Holding (TRIT), which plunged Wednesday to close at $12.24, down $1.88, or 13.31 percent. Global did increase their price target on Tri-Tech from $14 to $16.

ON Semi's (NASDAQ:ONNN) PT, EPS Estimate Raised by Needham

Citing ON Semi's (NASDAQ:ONNN) acquisition of Sanyo Semiconductor, in what is considered a good deal by Needham, they boosted ON Semi's price target and EPS estimate.

Needham says, "We have adjusted our earnings estimates to reflect the recently completed Sanyo Semiconductor acquisition, first announced in July 2010. Though we left our 2011 EPS unchanged at $1.05, we raised our 2012 EPS from $1.15 to $1.35. ONNN paid $144M in cash, assumed $129M in liabilities and borrowed $378M under a seven year loan agreement with Sanyo (N/R). Net of the $123M in cash on Sanyo Semi’s balance sheet, ONNN paid roughly $540M for approximately $1.2B in revenue. These terms compare favorably to ONNN’s original terms of $129M in cash, $302M in liabilities, and 35M shares of stock at $237M or about 8% dilution."

Needham & Company reiterates a "Buy" rating on ON Semi (ONNN), which closed Wednesday at $11.22, down $0.38, or 3.28 percent. Needham raised their price target on them from $11 to $13.

Majesco Entertainment (NASDAQ:COOL) Pulling Back After Running Up

Majesco Entertainment (NASDAQ:COOL) has soared since the middle of December, rising from $0.66 to $1.45 during that time.

The company in fact did pull back on Wednesday, falling from $1.40 to end the day at $1.12, a 20 percent plunge.

Needham noted early in the session, "COOL reported sales and EPS for 4Q'10 (ended 10/31/10) that were below our estimates, which, given industry weakness during the holidays, is not too surprising. COOL's recent rise is based on anticipation of very strong sales in Q1 of FY2011, driven by a few key titles. We expect FY2'11 to show significant improvement over 2010, but to be front-end loaded, as is typical with Q1 falling over the holiday season. We believe the stock remains attractive, but that given the recent strong runup, we would not be surprised to see a pull-back."

Even so, Needham reiterates their "Buy" rating on Majesco Entertainment (COOL), and have a price target of $1.50 on them.