Chipmakers Cavium (CAVM) and Monolithic Power Systems (MPWR) received a round of price-target increases from Wall Street analysts on Thursday after posting better-than-expected March-quarter results.
Meanwhile, Mellanox Technologies (MLNX) was hit with several downgrades after issuing a disappointing financial report.
Cavium got price-target hikes from at least four investment banks. Two of those firms, Needham and Susquehanna Financial Group, have buy ratings or the equivalent on the stock, while the other two, Jefferies and Stifel, rate it as hold.
Monolithic earned price-target increases from at least three investment banks. All three — Needham, Oppenheimer and Pacific Crest Securities — have buy ratings or the equivalent on the stock.
Cavium posted its fourth consecutive beat-and-raise quarter late Wednesday. The San Jose, Calif.-based company earned 58 cents a share excluding items, up 132% year over year, on sales of $229.6 million, up 125%, in the March quarter. Analysts expected Cavium to earn 56 cents on sales of $227.2 million.
For the current quarter, Cavium expects to earn 65 cents a share excluding items on sales of $239 million, based on the midpoint of its guidance. Wall Street was modeling for Cavium to earn 62 cents on sales of $235 million in the second quarter.
Cavium stock was up about 3.5% to 73.44 on the stock market today, just above a 73.11 buy point out of a six-week flat base. Cavium traded as low as 67.79 and as high as 74.
12th Straight Beat
San Jose, Calif.-based Monolithic posted its 12th straight quarter of meeting or beating its guidance with its Q1 results, Needham analyst Quinn Bolton said in a report.
Monolithic earned 58 cents a share excluding items, up 29%, on sales of $100.4 million, up 19%, in the March quarter. Analysts were expecting 57 cents and $100 million.
For the second quarter, Monolithic guided to sales of $111 million, vs. Wall Street's estimate of $109 million. It gave gross profit margin guidance in line with estimates.
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"The company is positioned nicely for 2017 with a diverse set of revenue drivers across the notebook, server, industrial, automotive and gaming segments," Bolton said.
Bolton reiterated his buy rating and raised his price target on Monolithic to 100 from 94.
Monolithic stock climbed 0.8% to 94.46. In intraday trading it reached as high as 96.52, just below its all-time high of 96.84 on Tuesday.
Fall For Mellanox
Mellanox shares tumbled on Thursday after the maker of high-speed networking-communications processors missed first-quarter targets. Mellanox stock fell 8.5% to 46.58.
Late Wednesday, the Israel-based company said its first-quarter adjusted earnings per share fell 64% to 29 cents, while sales dipped 4% to $188.7 million. Analysts expected Mellanox to earn 49 cents on sales of $205 million.
For the second quarter, Mellanox guided to sales of $210 million, when Wall Street was modeling $223 million.
At least three investment banks downgraded Mellanox stock after the earnings report. Credit Suisse, Piper Jaffray and Roth Capital changed their ratings to neutral from buy or the equivalent.
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