Two firms are out very positive on Sigma Designs (NASDAQ:SIGM) this morning after Warner Bros. Entertainment announced last Friday it will offer its high-definition DVDs exclusively using the Blu-ray format. The studio was previously backing both Blu-ray and HD DVD.:
- Baird notes Blu-ray could add an incremental $0.15-$0.20 to Sigma's EPS this year assuming Blu-ray player units double, a conservative assumption, in their view, given the aggressive pricing (starting at $273 currently) and higher visibility consumers now have regarding the prevalence of Blu-ray as the new DVD standard. Net, Warner's announcement it will only support Blu-ray going forward is a positive for Sigma given its 75% share position in this market.
Firm believes the recent weakness in the stock is unfounded and recommend buying on the weakness. Reiterating $75 price target and Outperform rating on SIGM shares.
- BWS Financial says the decline in shares of SIGM can only be described as breathtaking when considering that all aspects of the business continue to grow at a rapid pace. The earnings story is not over at SIGM. Firm believes the withdrawal of WB from HDDVD removes necessary content to make HDDVD a viable competitor to blu-ray. They consider the news from WB the death to HDDVD.
Notes they are pounding the drums once again just like they did in 2007 when the shares had declined due to competitive threat, and they are again reiterating their price target of $100.
Notablecalls: SIGM is going to see strong interest following this call. My guess is $2-3 upside range today. Be sure to grab it early. Actionable!
- Baird notes Blu-ray could add an incremental $0.15-$0.20 to Sigma's EPS this year assuming Blu-ray player units double, a conservative assumption, in their view, given the aggressive pricing (starting at $273 currently) and higher visibility consumers now have regarding the prevalence of Blu-ray as the new DVD standard. Net, Warner's announcement it will only support Blu-ray going forward is a positive for Sigma given its 75% share position in this market.
Firm believes the recent weakness in the stock is unfounded and recommend buying on the weakness. Reiterating $75 price target and Outperform rating on SIGM shares.
- BWS Financial says the decline in shares of SIGM can only be described as breathtaking when considering that all aspects of the business continue to grow at a rapid pace. The earnings story is not over at SIGM. Firm believes the withdrawal of WB from HDDVD removes necessary content to make HDDVD a viable competitor to blu-ray. They consider the news from WB the death to HDDVD.
Notes they are pounding the drums once again just like they did in 2007 when the shares had declined due to competitive threat, and they are again reiterating their price target of $100.
Notablecalls: SIGM is going to see strong interest following this call. My guess is $2-3 upside range today. Be sure to grab it early. Actionable!
4 comments:
Bad call, bad-bad call...
Heavy volume selling has hammered all the semis. SIGM may have more days in the sun but today wasn't one of them. The fear of BRCM STM competition and/or lower margins appears to have the same effect that OVTI experienced when it was feared that MU would eat their lunch.
Sometimes it pays to fade the open say by lookinbg at the high beta groups, stocks like solar.
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