JP Morgan Retains Overweight, PT on Dolby Laboratories

J.P. Morgan reiterates its Overweight rating and $40 price target on Dolby Laboratories, Inc. (NYSE: DLB) as F4Q11 is seen as a pivotal quarter, with attainable EPS but bound with risks.

In the report, J.P. Morgan writes, “We expect DLB to report F4Q11 PF EPS of $0.70 on $226.3mm in revenue (Street $0.68/$231.5mm). We expect licensing y/y growth to continue decelerating primarily owing to slowing laptop shipments and loss of ISV revenues, but also due to lackluster DTV sales. Mobile and other categories should continue to show positive momentum, through from a small base. We believe risks are skewed to the downside.”

DLB closed up 1.84 percent at $28.85 a share on Thursday.