Cantor Morning News | Tech/Media/Telco

Yesterday was a sell the news day in tech. There were a number of companies that reported earnings on Wednesday after the close and early Thursday morning with numbers being mostly disappointing. Some notable decliners included AKAM -13%, LSI -14%, ASIA -26% and QTM -24%. On a positive note CTXS +20%, ENTR +17% and CML +16% rallied after reporting quarterly results.

After the close WFR disappointed investors by reporting weak Q2 results and soft guidance, watch the solar space today. RGC missed estimates on both top and bottom line, watch CNK and CKEC.

On a positive note Samsung reported strong Q2 results with memory and LCD sales being particularly strong. SNDK, MU and GLW could be up today on that.

Macro/Technicals

Leaders: CTXS +20%, ENTR +16.5%, CML +15.6%, ITRI +8.6%
Laggards: NENG -34%, ASIA -26%, QTM -23.7%, TNDM -20%

Active Names

Enterprise/Service/ SW: BR, CIEN, DGIT, MCCC, MSFT, SWI, ASIA

PCs/Devices/Net: BIDU, DELL, ADCT, Q, CMVT, YHOO

Semis/Circuits: Storage: NVLS, MU, VRGY, AMD, WFR

Network Products: CSCO, BRCD, PLCM, FTR

Telco: CVC, GNCMA, ETM, VZ, T, TWX, ROIAK, LEAP

Electronic components: APH, TNB, ENS, SANM, ENTG

Media: AOL, CVC, SIRI, PLA, VMED

Smaller Caps: BDE, MTSN, ADPT, HYC, ORCC, VTSSD

Earnings

CAVM – down 8.2%. Solid Q2 on the back of the enterprise/service provider segments. Software and Support were a drag on earnings as both were disappointing. A strong new product mix loosk to make CAVM prime for growth in the future. The company gave higher guidance and said bookings in Q2 were robust.

AMCC – Strong Q with strong transport revs as a main driver. The company is seeing strong orders and lead times are lengthening. During the call the company did say they were experiencing supply constraints which could cause a rise in inventories.

SYNA – slightly better Q2, but in a Q where SYNA saw loss of market share and declining ASPs. Multi-Tocuh and mobile rev were both positive drivers in the Q sriven by the ramp of new products. Q3 was also guided higher due to the Q2 strengh in handsets, and strong results expected from PCs. Guided FY11 higher with its PC business expected to be a major driver in 2011.

KLAC – record Q4 with positive results across the board. Bookings were at an all time high as well as GMs and OPM. Orders were guided down for the coming Q, but largely due to seasonality. Slowing orders could present a problem for future Qs, but if they stay at current levels management will still continue to benefit from rising shipments. Guidance for Q1 looks very strong.

PAR- in line Q1 with strength coming from the service provider segment. Guidance looks to be essentially in line with consensus and FY11 guidance looks to be slightly higher. Mgmt was positive about an improving product pipeline that should help to drive future earnings.

ACTL – better Q2 on the top and bottom line. Margins in the Q were solid as well, and are expected to continue to rise in Q3

VSEA- Better Q driven by higher shipments to memory and foundry customers. Guidance for the September Q looks very strong, and mgmt said it appears trends for the Dec Q are also tracing up.

ALSK- Solid Q2, but 2H10 guidance in enterprise revs looks to be a little light. Loss of a govt contract could weigh on near term subscriber trends as well. The strong Q was helped by good bookings, which could help to offset the subscriber troubles.

CTCT- down 3.6%. in line to slightly better Q2 and guidance is mixed for Q3 and in line for FY10. Net adds in Q2 were the only really worry as they came up light. Mgmt attributed the decline in adds to seasonality and macro headwinds.

APKT- down 12.6%. Beat and raise Q2, but the street seemed to be expecting something more. The upside to revs came from strong maintenance/servicing business while product revs were flat in the Q. Enterprise and SP performed well in the Q and look to be primed to continue to grow.

TSRA- better Q2, but Q3 guidance is a little light on the rev front. Mgmt backed up from its 100m optics rev target for 2011, but said momentum in the segment is key for the company. TSRA showed strong growth in micro-optics in the Q. DRAM price breaks look to be primed to set in a little earlier this year.

ROVI- beat and raise Q2. A new product cycle and service prodiver revs are helping to drive earnings growth. rOVI looks primed to bbenefit from being a Google TV partner and will make money on every Sony set sold embedded with Google TV.

MFE- mixed Q2 with revs missing, but EPS slightly higher. A negative currency effect was a drag on the Q revs. Consumer growth in the Q was strong and was a major positive. A reduced marketing expense in the Q helped to drive the EPS beat. Enterprise rev was weak in the Q. Q3 guidance is lower on the top and bottom line as currency headwinds are still expected to have an effect on numbers.

WFR – down 6.7%. weak Q as margins were a miss. Semis and solar materials were essentially in line for the Q. Mgmt lowered FY10 guidance on SunEdison concerns. Mgmt is calling for growth in 2H10 in semis and solar ,materials. Mgmt is calling for improvement in semi pricing 2H10, but a chip inventory correction could affect the pricing.

RNWK – better Q on better margins due to cost controls. Headwinds in the games segments are getting stronger and mgmt announced a change to management in the segment.

QSFT – up 5.8%. better Q, but no guidance given although mgmt’s tone seemed positive.

MXIM- up 3.6%. better Q2 and lead times look to be stabilizing.

Sector News, M&A, Capital Raises

FMCN, VISN Macquarie Research initiates Focus Media initiated outperform with $23 target; VisionChina Media initiated outperform with $5.25 target

CAVM, VSAT Cavium Networks announces supply agreement with ViaSat

AUTH AuthenTec names Larry Ciaccia as president and COO; resignation of CFO

VIA.B Viacom credit rating upgraded to BBB+ from BBB by S&P; outlook is stable.

QSFT Quest Software announces acquisition of Surgient

DNB Dun & Bradstreet Credibility Corp acquires Self Awareness Solutions operating unit of Dun & Bradstreet

SIGE Sige Semiconductor files $143.8M IPO through Barclays, Deutsche, and Jefferies

GOOG Google says its web search service availability in China is fully blocked -- CNBC

GOOG TechCrunch discusses Google outage in China, or lack thereof

INTC Reuters reports that talks between Intel and Infineon regarding wireless unit are at advanced stage

Research Away

ARRS upgraded to hold from underperform at Jefferies

TSYS downgraded to perform from outperform at Oppenheimer

OPEN downgraded to neutral from buy at Bank of America Merrill Lynch

KLAC upgraded to hold from sell at Citi

Disclaimer: Prepared by staff of Cantor Fitzgerald & Co. ("Cantor") and is for information purposes only. It is not intended to form the basis of any investment decision, should not be considered a recommendation by Cantor or any other person and does not constitute an offer or solicitation with respect to the purchase or sale of any investment nor is it a confirmation of terms. Any calculations and valuations presented herein are intended as a basis for discussion. Sources of information are believed to be reliable but Cantor makes no representation and gives no warranty that the information contained herein is accurate or complete. Any opinions or estimates given may change. Cantor undertakes no obligation to provide recipients with any additional information or any update to or correction of the information contained herein. This material is intended solely for institutional investors and investors who Cantor reasonably believes are institutional investors. Cantor, its officers, employees, affiliates and partners shall not be liable to any person in any way whatsoever for any losses, costs or claims howsoever arising from any inaccuracies or omissions in the information contained herein or any reliance on that information. Cantor may have positions in financial instruments mentioned, may have acquired such positions at prices no longer available, and may have interests different or adverse to your interests. No liability is accepted by Cantor for any loss that may arise from any use of the information contained herein or derived here from. This product may not be reproduced or redistributed outside the recipient's organization. Sources: Cantor Fitzgerald & Co., Reuters, Bloomberg, CNBC, Dow Jones, Marketwatch, Trade-Alert, and the Wall Street Journal. ***All eco data from Bloomberg and DJ