Meeting With Spansion CFO Leaves Pacific Crest Feeling Optimistic
Shares of Spansion (NYSE: CODE) are up 6.1 percent to $17.32 after Pacific Crest raised the price target from $17 to $20 following a meeting with the company's chief financial officer Randy Furr.
The meetings focused on how Spansion “can use its fab infrastructure to improve margins,” said analyst Monica Garb.
“$14 million per quarter in margin benefits for Spansion's NOR business and almost 300 basis points of margin improvements in the Fujitsu business” could be attained should Spansion “move 55% to 60% of its Fujitsu business to its Texas fab,” said Garb.
Garb believes “NAND margins and revenue have upside.” Spansion “believes it can grow NAND to $200 million to $250 million per year over the next two to three years and reach 30% margin,” said the analyst.
Garb's $20 price target on Spansion is 15 percent above current levels.
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