Atheros Sees Growth Due to New Business Segments & Intellon Acquisition (ATHR, MRVL, BRCM)
January 26, 2010 9:53 AM
FBR Capital Market analysts Craig Berger and Robert Pikover have given a Market Perform rating to Atheros Communications Inc, (NASDAQ: ATHR) with a price target of $39.
The reason for this optimism about Atheros is because its Q4 revenues at $186 million surpassed market expectations. The growth drivers for Atheros in 2010 will be Wi-Fi/Bluetooth modules and growth in Ethernet Controllers business. Atheros’ acquisition of Intellon to offer next generation powerline solutions is also set to drive additional growth for it.
The analysts have raised their EPS estimate from $1.90 to $2.05 for 2010 and further to $2.20 for 2011 based on these results. The analysts, however, show concern over Atheros facing competition from giants such as Broadcom (NASDAQ: BRCM), Marvell Technology Group (NASDAQ: MRVL) and Qualcomm Inc, (NASDAQ: QCOM) in the high end market and from Realtek and Ralink in the low end market. Atheros is currently trading at $34.30.
