Predicting the Biggest Tech Earnings Winners: Dell, HP, Tower Semi and More (ADI, DELL, HPQ, IBM, ORCL, TSEM, TSM, BRCD)
Earnings season is winding down in the tech sector. What should investors expect from these reports? What are the key storylines to follow and are these stocks likely to trade higher or lower in the wake of their results?
In NextInning.com’s earnings previews, available free to trial subscribers, key storylines are evaluated, analyst expectations are audited, and in depth valuation analyses are provided to develop fair value ranges for dozens of stocks, allowing investors to determine which stocks to favor and which to avoid ahead of earnings reports.
Some of the stocks covered and questions answered in the report include:
Analog Devices (ADI) – “Analog Devices has a very simple, but effective, model now in place. Analog Devices serves an extraordinarily broad base of applications, and has high exposure to the various industrial sectors. This model worked very well for Analog Devices during 2010 and will be a positive long-term catalyst going forward. Analog Devices also has a very strong position in the expanding market of mobile communications where its parts are used in most, if not all, basestation designs.” Is Analog Devices undervalued right now?
Dell (DELL) – “While Dell is still a long way from putting together a solid enough enterprise ecosystem model to compete effectively with Hewlett-Packard (HPQ), IBM (IBM), or what Oracle (ORCL) will soon assemble, it has clearly made progress.” Is now the time to get in on a Dell turnaround play?
Tower Semiconductor (TSEM) – “In Next Innings’ June 2009 State of Tech coverage, McWilliams opened the door for speculation in Tower, terming it initially a play for ‘wide-eyed gamblers’ willing to look beyond the then top four foundry companies. In the September 2009 State of Tech report, McWilliams stated it had become his favorite speculative play in the contract fabrication sector, as well as a good stock to pair with a strategic investment in industry leader Taiwan Semiconductor (TSM). At $1.27 on May 11, Tower is up an about 340% from the June 2009 buy point of $0.29. While the easy money has been made here, there is more upside potential for Tower if it is able to shoo the elephant that is sitting on its stock price from the room.” What is the “elephant in the room” and can Tower address it?
Hewlett-Packard – “Mark Hurd left HP with a very solid foundation of resources from which it can continue to build and compete. HP could further expand that solid base by purchasing a major technology firm that would fill a huge void in HP’s ecosystem model.” What major software firm would make a great acquisition for HP?
Brocade Communication Sys (BRCD) – “Analysts have virtually written Brocade off, and the forward estimates have been chopped to the ground (current fiscal year consensus is $0.47).” Is Brocade now easily positioned to surpass Wall Street’s rock-bottom expectations? Is Brocade a likely acquisition target?
In its earnings previews for the week of May 9th, NextInning.com looks at several popular tech stocks set to report earnings, including Analog Devices, Dell, HP, Tower Semi, Brocade and more.
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