UPDATE: Needham & Company Downgrades Sigma Designs as Company Manages Through Product Transitions

In a report published Thursday, Needham & Company analyst N. Quinn Bolton downgraded the rating on

from Buy to Hold, and removed the $6.00 price target. In the report, Needham & Company noted, “SIGM delivered a 3rd consecutive quarter of non-GAAP profitability, reflecting aggressive cost management. OPEX declined by $1.0MM Q/Q and management has now reduced OPEX by over $40MM on an annualized basis. Unfortunately, F4Q14 revenue guidance was well below expectations, reflecting seasonality, inventory adjustments and product transitions across several product segments. With its HPNA business now likely in a secular decline, we expect revenue will remain under pressure until F2H15 when new product cycles in STB and DTV ramp. As we expect shares to be range-bound until revenue recovers, we are downgrading SIGM to Hold from Buy and removing our 12-month $6 PT.” Sigma Designs closed on Wednesday at $5.35.