Mindspeed Technologies initiated with "buy"

10/10/03 - Independent Research

NEW YORK, October 10 (New Ratings) – Analysts at Independent Research Group initiate coverage of Mindspeed Technologies, Inc (MND) with a "buy" rating. The target price is set to $7.50.

Shares of Mindspeed Technologies, a provider of semiconductor networking solutions for the transmission of voice and data, are currently trading at $5.29.

According to Independent Research Group’s research note published this morning, Mindspeed Technologies’ wide product and service range gives the company a competitive edge over its sector peers. The company is poised to capitalize on the expected increase in wireline semiconductor spending over the next year, the analysts add.

The analysts say that the company is expected to become profitable by 1Q05 through the streamlining of its operating expenditure. Although this would mean that mid-term volatility remains, it would ensure that Mindspeed Technologies’ stock becomes a viable longer-term investment. Independent Research Group identifies the sluggish carrier capital expenditure, restricted cash flow and long sales cycles as risk factors for Mindspeed Technologies.

The EPS estimates for 2003, 2004 and 2005 are -$1.12, -$0.39 and -$0.04, respectively.

Independent Research Group initiates coverage of Mindspeed Technologies with a "buy" rating.