Silicon Motion ( NASDAQ: SIMO ) shares rose as much as 5% Wednesday as the memory-technology company received a rating upgrade from Needham, and also moved closer to being acquired by MaxLinear ( NASDAQ: MXL ).
Before U.S. stock markets opened, Needham analyst Rajivindra Gill raised his rating on Silicon Motion's ( SIMO ) stock to buy from hold, and set a $75-a-share price target on the stock. Gill cited what he called "better than feared results" as a main reason for his upgrade.
On Wednesday, Silicon Motion ( SIMO ) reported a third-quarter profit of $1.53 a share, on revenue of $250.8M, which fell short of analysts' estimates for earnings of $1.98 a share on $266.2M in sales.
Gill said that despite the earnings and sales miss, Silicon Motion's ( SIMO ) fundamentals "are coming in better than feared" and that the company should be able to reach $1B in annual revenue next year.
Separately, China's state market regulator reportedly gave its approval to MaxLinear's ( MXL ) offer to acquire Hong Kong-based Silicon Motion ( SIMO ) for $3.8B, or $114.34 a share in stock and cash. Gill said it still might take until August 2023 for the deal to be completed .
For further details see:
Silicon Motion heads north on Needham upgrade; Chinese OK of MaxLinear's acquisition plans