Jefferies Raises Price Target On Spansion
In a research note released Monday, Jefferies analyst Sundeep Bajikar maintained its Hold position on Spansion (NYSE: CODE) and upgraded its price target to $21.00 from $18.50.
Bajikar emphasized the company appears to be executing well and after having a conference with some of the company's executives, the firm feels more confident. Bajikar continued by adding that the firm could feel better as Spansion's gross margin expands or it could feel worse if the executives fail to execute properly.
Spansion is also expected to have higher fab utilization rates trending near 65 percent and expected to be above 90 percent in 2015. A higher fab rate tends to drive up gross margins, absorb fixed costs and lower production unit costs.
Bajikar continued to state that he believes that the high density embedded NOR market will likely be more concentrated over time, hence making it harder for Macronix to remain in the market.
Currently, Spansion sees three avenues for monetizing its intellectual property:
• Licensing its Spansion IP
• Sales of Patents
• Patent prosecution
Shares of Spansion are up two percent Monday, and are up a whopping 50 percent year-to-date.
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