Integrated Device ($IDTI) Stock | Tanks On Lowered Guidance


Integrated Device Technology, Inc. (NASDAQ: IDTI)



Solid third quarter financials could not keep the stock of semiconductor maker, Integrated Device Technology from plummeting on Tuesday. IDTI earnings were in-line with analyst’s expectations and revenue came in higher, but the company lowered guidance for the fourth quarter on a day of broad market selling that punished any negative news.


For the third quarter IDTI reported revenue of $177.6 million, a 17.5% year over year increase and a solid beat of consensus estimate of $175.7 million. Non-GAAP earnings came in on target at 35 cents per share. Going forward the company lowered fourth quarter guidance, forecasting revenue between $182 and $192 million, with earnings between 32 to 34 cents per share. Consensus estimates were revenue of $196.3 million and earnings of 36 cents per share.


CEO Comments

“We achieved a number of key milestones in the third quarter of fiscal 2016,” said Greg Waters, president and chief executive officer. “On December 7th, we closed the acquisition of ZMDI and the following week we executed a $374 million convertible note offering, with a concurrent accelerated share repurchase program. We delivered our 9th consecutive quarter of year-over-year revenue growth, driven by strong demand for our communications infrastructure products. With our continued focus on operational excellence, we achieved a non-GAAP operating margin of 29.4 percent, and record free cash flow of 30 percent of revenue on a trailing twelve-month basis.” Business Wire


IDTI Technical Analysis

IDTI Chart

On Tuesday, IDTI traded 25.4 million shares, almost 10 times average daily volume and by far the highest volume in the company’s 32 years as a public company. The stock closed Tuesday down 27% at $18.67 and as expected some analysts opined that the stock is oversold and raised price targets, while others just as convincingly jumped on the bearish bandwagon. From an intra-day trading perspective there are some solid levels to use for trade entries and exits depending on price action. Tuesday’s low of $17.95 is an area that has acted as support since November of 2014. If the market continues to selloff and IDTI breaches that level, there is plenty of room to the downside with support levels near $17.00, $16.00 and $14.50. On a bullish move price could see resistance near $19.00, $19.40, $20.40 and $21.20.


IDTI Company Profile

Integrated Device Technology, Inc. (IDT) is a developer of mixed-signal semiconductor solutions. The Company offers semiconductors for communications infrastructure in both wired and wireless. It designs, develops, manufactures and markets a range of semiconductor. It operates in two segments: the Communications segment and the Computing and Consumer segment. Its Communications segment includes clock and timing solutions, flow-control management devices, including Serial RapidIO switching solutions and radio frequency (RF) products. Its Computing and Consumer segment includes clock generation and distribution products, server memory interface products, PCI Express switching solutions, power management solutions and signal integrity products. It offers communications timing products, serial rapidIO solutions, RF products, consumer and computing timing products, memory interface products, PCI express switching solutions, power management solutions and signal integrity products. Google Finance