Dallas, Texas 02/05/2014 (FINANCIALSTRENDS) – The stock of the $1.53 billion market capped RF Micro Devices, Inc. (NASDAQ:RFMD) has been on the move at the stock market ever since it reported better than expected third quarter operations results. Recognizing the strong growth momentum built up by the small cap semiconductor and devices player, analyst agency Canaccord Genuity upgraded the stock to a Buy rating and has also increased its price target to $7.25 per share. On the back of these strong drivers, in the past week, the stock has posted steady 10.4 percent increase in its market value to add to the 4.6 percent increase it posted yesterday.
The key highlights of the 3Q results are as follows:
Net profit for the quarter came in at $36.4 million translating to 13 cents per share earnings. This compares very well to the $21.3 million net earnings that it had reported in 3Q12. RF Micro Devices, Inc. (NASDAQ:RFMD) new operating model and the attendant enhanced financial benefits were talked about by the management team on the earnings call.
Company President & Chief Executive Officer Bob Bruggeworth has been quoted to have explained that, “RFMD has achieved more than 500 basis points of gross margin expansion in three quarters. Despite shortfall in revenue, RFMD delivered a quarterly record in gross profit and achieved our EPS forecast of $0.13, reflecting the changes we’ve incorporated into our operating model. On the balance sheet cash flow from operations was a very strong $70 million and free cash flow was $55 million.”
4Q Guidance
On the back of the new momentum, RF Micro Devices, Inc. (NASDAQ:RFMD) has forecasted that in the 4Q operations it will be able to expand its gross margins to more than 40 percent and for the full year 2014 operations, hopes for achieving, “margin expansion, operating leverage and earnings growth”.
