Ah, don’t you just love a good fight? I mean, is there any other reason to watch hockey? Anyway, yesterday a fight broke out over Sigma Designs (NASDAQ:SIGM), a company which makes chips for IPTV systems.
To refresh your memory: Wednesday, Sigma shares slumped $3.28, or 10.8%, after Jeff Schreiner, an analyst with American Technology Research, raised concerns about increasing competition in the IPTV chip market. Schreiner Wednesday dropped his rating and price target on the stock.
Yesterday, Tristan Gerra, an analyst with Robert W. Baird, came riding in to the rescue. He wrote in a note:
Concerns about Sigma Designs’ deteriorating competitive environment [are] overblown, in our view. Sigma Designs is locked in for two years in wins which have yet to ramp and represent over 50% of Sigma’s total design win base. Wins include key telcos in Europe and in Asia, with India a particularly large potential for SIGM.
He adds that Sigma is “also well positioned to have a lock on new-generation DVD players,” including both Blu-Ray and HD-DVD.
Gerra repeated his Outperform rating and $34 price target and asserted that he would “aggressively buy on the weakness.”
Sigma yesterday was up 31 cents at $27.39.