Lehman: Strong Sales For Motorola Carrying RF Micro Along (MOT, RFMD)

 |  Includes: GOOG, QRVO

Lehman Brothers analysts Jeff Kvaal and Tim Luke raised their revenue estimates on both Motorola (MOT) and RF Micro Devices' (RFMD) for next quarter. Excerpts from the analysts' note to clients regarding the RFMD adjustment, and charts on both stocks:

our checks suggest strong 4Q handset sales and particular strength at Motorola... Demand for RFMD's POLARIS 2 through ~15% customer Motorola appears robust. We are lifting our MOT ests this morning. Key phones for RFMD at Motorola include the SLVR (L7), PEBL, ROKR E2, and RAZR V3/V3i...

Our FY07 (March 07) est rises from $842M/$0.25 to $875M/$0.29 vs. consensus of $853M/$0.26. We believe $0.30-$0.35 is possible... Our price target is $9 or 2.4x 2006 sales. The shares trade at 1.6x 2006 sales.

RFMD 1-yr chart:

MOT 1-yr chart: