Altera Q3 net income almost quadruples!

Well the results of Altera 3rd quarter earning is stellar comparing to what the company fares a year ago... the company's net income nearly quadruples mainly driven by strong sales from telecommunication and wireless equipment makers. The company reported earning of $217.5mil or 69 cents per share versus $56.7mil, or 19 cents per share a year ago. Analyst had expected 65 cents per share. Revenue rose 84% to a record 527.5mil.

Altera outlook calls for the 4th quarter revenue to grow 3-6% over the 3rd quarter which implies a maximum of $559.2mil compares to what analyst have in mind that is $512mil..

Surprisingly today Morgan Stanley gave a underweight rating on the company with a target share price of $24. Bear in mind that the share is now trading at $29.13 at the point of writing.
Just why are these so called analysts giving a negative outlook on the company when the results clearly shows the opposite??

My comment is simple, these people could have taken a large short position on Altera and Xilinx and are banking that the stock price will go down after hitting a high of $30.50 a few weeks ago. Or perhaps these analysts have more insider information that the rest of us which makes them believe that the stock price will plummet from here on.

From now to $24 that is almost a 25% market cap reduction. At the same time, at current price with the earnings combined so far from all 3 quarters (~$2 per share), Altera will trade at a PE of barely 15. and that is without Q4 result. Assuming Q4 the earning is conservative 50 cents per share, that woull translate to a $2.5 earning per share. with $29.3, the PE will be 11.8.

Personally, I think the comments givent by these bunch of analysts are pure speculation and without any basis to support, at the same time the target price are definitely questionable and I would call for all investors to look into the integrity such negative calls made by these so called analysts purely based on nothing concrete but speculative in nature and definitely with lots of hidden agenda.
Such calls are irresponsible and definitely a joke especially when they are coming from big financial institutions in the US. It is apparent that these people have yet to learn from the mortgage crisis that hit them a couple of years back... Let us all live to witness if these people are real analysts or just a bunch or crappy anal-ysts.

We shall see....