Stocks in Focus: ATI Technologies, NVIDIA, and Intel Surpass Expectations

Strategic Insights -

Zacks.com analysts provided insights on the latest market developments and their impact on stocks such as ATI Technologies (Nasdaq:ATYT), NVIDIA (Nasdaq:NVDA), and Intel (Nasdaq:INTC). These analysts highlighted the potential for ATI Technologies to regain market share with the launch of its Radeon X1900, while NVIDIA and Intel continue to face competition in the market. Transmeta (Nasdaq:TMTA), a company known for its application-specific microprocessors, was deemed a very speculative stock with a high risk of bankruptcy due to its cash constraints and poor operating performance.

Key Takeaways:

  • ATI Technologies is expected to regain market share with the launch of its Radeon X1900, which will secure new design wins and boost sales in the high-margin enthusiast segment.
  • The ramp of Microsoft's (Nasdaq:MSFT) Xbox 360 and Vista operating system will benefit ATI Technologies, leading to improved revenue estimates for the third and fourth quarters.
  • Transmeta (Nasdaq:TMTA) is considered a very speculative stock due to its cash constraints, poor operating performance, and stiff competition from Intel (Nasdaq:INTC), making a sell rating necessary.
  • The US government's fiscal policy, known as pay-go, will not reduce the deficit or affect the national debt, as argued by Senator Judd Gregg (R-NH) in a recent letter to the editor.
  • The country's fiscal house is unlikely to get in order anytime soon, with unfunded liabilities reaching $65 trillion and the retirement of the Baby Boom generation looming on the horizon.

Statistics:

  • ATI Technologies is expected to announce results for the third quarter of fiscal year 2006 on June 29th, with revenue estimates ranging from $640 to $680 million.
  • Gross margin is expected to improve to 30% for ATI Technologies, leading to a rise in EPS estimates.
  • Transmeta (Nasdaq:TMTA) has signed bigger-sized licensing contracts for its LongRun2 technology, but royalty revenue is unlikely to start until late 2006.
  • The company is cash-constrained, with the possibility of bankruptcy, making it a high-risk investment.

Sources:

  • "Analyst Blog" by Zacks.com, no date specified (available at http://at.zacks.com/?id=2673)
  • "AT&T: A Very Speculative Stock" by Zacks.com, no date specified (available at http://at.zacks.com/?id=2645)
  • Letter to the Editor, Senator Judd Gregg (R-NH) in the New York Times, no date specified
  • Zacks Equity Research, no date specified (available at http://at.zacks.com/?id=2674)
  • About Zacks Investment Research, Inc., no date specified (available at http://at.zacks.com/?id=2674)