Ahead of the Bell: Texas Instruments shares rise (AP)
Tue, 9 Jun 2009 13:00:31 Etc/GMT
The Dallas company projected earnings of 14 cents to 22 cents per share on sales of $2.3 billion to $2.5 billion for the quarter ending this month.
That's up from a previous forecast of 1 cent to 15 cents per share on sales of $1.95 billion and $2.4 billion and well above the average estimate from Wall Street analysts, who were looking for earnings of 10 cents per share on sales of $2.21 billion.
Analysts were encouraged to hear from the company that customers are burning through less of their inventories. Texas Instruments makes chips for cell phones and other electronics as well as automobiles, which saw demand plummet as the recession grew worse last year.
Thomas Weisel analyst Tore Svanberg said the company's improved outlook indicates it "could be experiencing modest demand improvement in its end markets." Svanberg reiterated an "Overweight" rating on the stock in a client note late Monday.
Shares jumped $1.28, or 6.5 percent, to $21.05 ahead of regular trading Tuesday.
But observers also sounded cautious on the company's wireless business, as well as uncertainty over a true recovery in consumer demand.
Deutsche Bank analyst Ross Seymore told investors in a note late Monday that he expects the company's stock to perform well off of the improved outlook. But he reiterated his "Hold" rating on the stock, warning of economic uncertainty and "pending wireless share losses."
Craig Berger, an analyst with FBR Capital Markets, said in a note Tuesday, "We respect management's commendable execution and deep cost reductions," but kept a "Market Perform" rating on shares because of "the firm's declining wireless business" and average stock price compared with peer companies.
source: http://biz.yahoo.com/ap/090609/us_texas_instruments_ahead_of_the_bell.html?.v=1