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Friday, July 14, 2006

Calls of Note Part 5

- Baird is positive on Sigma Designs (NYSE:SIGM) saying checks indicate continued momentum for Sigma Designs in the quarter while competition remains muted. A number of recent new product announcements which they believe incorporate Sigma's decoders suggests broad acceptance across a variety of platforms. Gross margin should stabilize in the quarter and create additional second-half earnings leverage.

Sigma Designs currently trades at just 8x firm's calendar 2007 GAAP EPS estimate of $1.15, which indicates a severe disconnect with the company's fundamentals. Reiterates $21 price target and Outperform rating on SIGM shares.

Notablecalls: Expect to see a bounce on the call.

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