GOLDMAN CUTS ALTERA TO SELL FROM NEUTRAL, XILINX TO NEUTRAL
Goldman Sachs analyst James Schneider says he is becoming more cautious on programmable logic devices (PLD) stocks, as he now believes there likely to be significant pullback in communications infrastructure spending, especially for wireless infrastructure in emerging markets, over the next year.
He downgrades Altera (ALTR) to sell from neutral and Xilinx (XLNX) to neutral from buy. Despite outperformance relative to his coverage in past year and good cost control from both companies, Schneider believes growth is likely to be challenged in 2009.
He cuts Altera $1.20 2009 EPS estimate to $0.95 and $1.50 2010 to $1.00, and his $20 6-month price target to $16.
CREDIT SUISSE REITERATES OUTPERFORM ON APOLLO GROUP
Credit Suisse analyst Kelly Flynn says Apollo Group's (APOL) $0.75 pro-forma EPS beat her $0.64 view. She says 15.4% enrollment growth beat her 10.6%, accelerating from third quarter's 11%; 19.1% starts growth beat her 8.5%; non-associates starts grew 8.1% against a tough comp.
Flynn also notes that the company's retention was up 240 basis points, operating margin expanded 273 basis points, and free cash flow growth outpaced EPS growth by more than 300 basis points.
She raises $3.28 fiscal year 2009 (August) EPS estimate to $3.48. She remains optimistic that her new estimate could prove conservative if current trends continue. She sets fiscal year 2010 estimate at $4.03. She also increases her price target to $75 from $70.
NEEDHAM DOWNGRADES VISTAPRINT
Needham analyst Mark May says he's downgrading VistaPrint (VPRT) to hold from buy, as its first quarter results confirmed his view going into the report that VPRT's business is likely paced in line, but that a strengthening U.S. dollar would negatively impact the company's fiscal year 2009 (June) revenue guidance.
May notes that what he didn't fully anticipate was the meaningful (likely economically-induced) slowdown in order growth that VPRT has supposedly witnessed since the start of the second quarter.
He cuts $1.52 fiscal year 2009 EPS estimate to $1.32 and $521.2 million revenue forecast to $480.1 million.