Speaking to analyst Tristan Gerra about Semiconductors this week, he recommended to us a high-quality Semiconductor company that has recently come upon an “attractive entry point” due to a Q4 that dissapointed expectations, Altera (ALTR):

Mr. Gerra: Altera is one of the higher-quality names in the semiconductor space. They have virtually no debt, they consistently generate gross margins north of 60%, and they have over $1 billion in cash….This is a company that has basically been growing the top line at double digits consistently since 2003. EPS has gone from $0.23 in 2002 to what we think will be over $1 in EPS for next year. It’s clearly a company where the compounded annual growth rate has outpaced the rest of the semiconductor industry, and it’s trading at about 18 times next year earnings at this point. It also has one of the best quality management teams in our space, in our view…Altera’s stock has corrected significantly recently because of a somewhat disappointing Q4 guidance, which in our view did not reflect on any changes in fundamentals at the company and which created an attractive entry point a few quarters out.

For the full Semiconductors interview, including a broad range of opinions on the state of this sector, and more stock picks, click here.

This entry was posted on Thursday, December 20th, 2007 at 4:10 pm and is filed under Technology Stocks. You can follow any responses to this entry through the RSS 2.0 feed.