Citi Comments on Intersil's Analyst Day

In a research report published this morning by Citi, Intersil

hosted an analyst day yesterday that publicized an updated near-term target profitability model. According to Citi, "ISIL tuned down its target profitability model (Fig 1) to $200M/Q, 57% GM, 33% OpEx, 24% OM on a non-GAAP basis (ex-amort, ex-SBC) vs. the original model given two years ago ($250M/Q, 58% GM, 32% OpEx, and 26%+ OM). New targets appear achievable compared to ISIL's financials when sales were >$200M in 2Q10, 3Q10 and 2Q11. At $800M run rate, new model implies $1.04 nonGAAP annual EPS or $0.78 adjusted EPS (inc-amort, inc-SBC) vs. our updated $0.43 and the Street's prior $0.39 for C13E. 1pnt rev =2c C13E EPS, and 1pnt GM = 4c EPS." Citi maintains its Neutral rating on Intersil, which closed yesterday at $10.66.