SAN FRANCISCOFBR Capital Markets Monday (Nov. 24) cut revenue estimates and price targets on 10 semiconductor stocks, saying in a report, "Global semiconductor demand trends are deteriorating faster than we can cut estimates."
FBR believes revenues for broad-line chip firms should fall by 20 to 30 percent from the shipment peak in the third quarter of 2008 to the shipment trough in the first or second quarter of 2009, wrote analyst Craig Berger.
In addition to cutting estimates and price targets, FBR downgraded its ratings on Linear Technology Corp. and Maxim Integrated Products Inc. to "underperform," the equivalent of "sell." FBR downgraded its rating on National Semiconductor Corp. to "market perform," the equivalent of "hold."
Other companies that saw their estimates and price targets cut by FBR included: Advanced Micro Devices Inc., Atmel Corp., Fairchild Semiconductor International Inc., International Rectifier Corp., LSI Corp., Marvell Technology Group Ltd. and Silicon Laboratories Inc.
The global credit squeeze is causing chip customers to de-stock inventory at warehouses around the world, Berger wrote. Chip vendors that recognize distributor revenues on a sell-in basisincluding Atmel, AMD, Fairchild, IR, Maxim, Microsemi Corp. and National Semiconductorshould see larger revenue declines than firms that recognize sales on a sell-through basis, Berger wrote.