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RFMD going to $5+ short-term and $8.20 in 2010

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November 11, 2009 – Comments (0) | RELATED TICKERS: RFMD

.42 eps x 20 PE = $8.20 in FY 2010 based on current eps estimates.
Projection could rise higher or lower based on EPS estimate but the trend has been for increasing eps in last 6 months.

Analyst raised RFMD eps to .42 from .32 FY2010

RF Micro Device: Color on qtr (4.02 ) : Kaufman notes yesterday after the close RFMD reported fiscal 2Q10 (Sept.) rev of $254.8 mln (+20% Q/Q, adjusting for extra week in quarter +11% Q/Q) well ahead of consensus $233.3 mln (+10% Q/Q) expectations and reflected improving RFMD presence outside lead customer Nokia (non-Nokia handset +50% Q/Q), growth into the China market (+75% Q/Q) and recovery in cable TV (+70% Q/Q). EPS of $0.13 beat consensus by $0.04, reflecting a revenue and gross margin upside, coupled with good cost controls. Firm expects revenue to be up slightly after adjusting for the 7%-8% Q/Q decline from one less week of business in Dec. Firm also expect margins to hold and are modeling slight sequential EPS growth for RFMD. With expectations of steady operating expenses and margins, firm believes RFMD can sustain current profitability into the next few quarters in a stabilizing handset environment... Broadpoint AmTech notes RFMD reported a strong beat and raise Sept with strength across the board. Firm estimates ~26% q/q growth for CPG (80% of sales). Firm believes RFMD is taking significant share at Samsung and local Chinese players. The co generated $46 mln in free cash flow and ended the qtr with $136 mln of net debt, down from $176 mln last qtr. Firm estimates NOK remains RFMD's top customer but saw strength this quarter from share gains at Samsung, Huawei (data cards), Sony-Ericsson and ZTE. RFMD also suggested significant ramps in netbooks, CATV, meter-readers and GPS applications. Firm looks for switching products to add content beginning in the December qtr. RFMD indicated a book-to-bill above 1 for both MPG and CPG and said they are booked for q/q rev growth. Firm raises FY10 EPS to $0.42 from $0.32 and FY11 to $0.47 from $0.40.

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