Wells Fargo Initiates NSM Coverage with An MP Rating

Wells Fargo is initiating coverage of National Semiconductor Corporation NSM with a Market Perform rating on the shares. “National has been transitioning over the past few years to become more of a pure analog company; National's reported analog segment sales have risen to 94% of total sales in FY2010 from 79% in FY2002,” Wells Fargo writes. “Gross margin has risen steadily over the past few years, to a recent peak of 70.9% in the August 2010 quarter from 47% in the August 2003 quarter. Operating margin has also risen in recent years, to a recent peak of 34% in the August 2010 quarter.” Wells Fargo said that, on the other hand, National's analog growth has lagged its peers' in the past few years, and through the most recent downturn. National Semiconductor Corporation currently trades at $13.91.