SanDisk Corp. (NASDAQ: SNDK) reports earnings after today’s close and estimates from First Call are $0.64 EPS on $1.27 Billion in revenues.
Interestingly enough, American Technology Research analyst Doug Freedman has just made a more conservative call ahead of today’s results. Freedman is maintaining his BUY rating, but he is lowering his target to $40 and is lowering estimates for Q4 2007 and for 2008.
This call reflects more aggressive ASP erosion than anticipated and lower shipment densities. The call also notes that Apple’s (NASDAQ: AAPL) lack of a new product introduction at MacWorld that pushes NAND density higher is a negative. AmTech also noted they are hearing of NAND equipment order push-outs and there is a belief of a NAND oversupply for the first half of 2008. This also notes that Q4 pricing was materially below what was an already lowered guidance. AmTech lowered the estimates quite a bit:
- December quarter revenue and EPS estimates from $1.445 Billion and $0.69 to $1.259 Billion and $0.49;
- Lowered 2008 revenue and EPS estimate to $5.092B and $1.79 from $6.085B and $2.45 (while consensus estimates are $4.88 Billion in revenues and $2.36 EPS.
This cut won’t change consensus estimates that much as there are over 15 analysts making predictions, but it might lower a bar that should have already been expected to be low. SanDisk shares are down over 2% after the open at $24.99, and the 52-week trading range is $24.29 to $59.75.
Jon C. Ogg
January 28, 2008
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