UPDATE: Canaccord Genuity Upgrades Spreadtrum Communications to Buy Following Raised Q2/13 Sales Guidance

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In a report published Thursday, Canaccord Genuity analyst T. Michael Walkley upgraded the rating on Spreadtrum Communications SPRD from Hold to Buy, and raised the price target from $24.00 to $29.00.

In the report, Canaccord Genuity noted, “Spreadtrum significantly raised its Q2/13 sales guidance well above its prior guidance and above our expectations driven by continued strength in affordable smartphone sales in China. We believe Spreadtrum's 2.5G and EDGE design wins with Samsung, strong ongoing sales of single-core TD-SCDMA chipsets to affordably priced smartphones selling in tier 3 to tier 6 cities in China, ramping sales of recently launched dual-core solutions, and expanding product portfolio contributed to the increased guidance. With an expanding portfolio combined with accelerating low-end smartphone growth in emerging markets, we believe Spreadtrum should post strong sales growth through 2014 despite increased TD-SCDMA competition and a secular decline in the global feature phone market. We increase our price target to $29 from $24 and upgrade to BUY from HOLD.”

Spreadtrum Communications closed on Wednesday at $18.95.

Posted In: Analyst ColorUpgradesAnalyst RatingsCanaccord GenuityT. Michael Walkley
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