NEW YORK (AP) ¿ Shares of chip maker Supertex Inc. were up more than 5 percent Tuesday after an analyst upgraded the stock to "buy" based on its position as the sole supplier of drivers for Samsung Electronics Co. light-emitting diode televisions.
Collins Stewart analyst John Vinh raised his rating from "hold" and set a $31 price target. The shares were up $1.48, or 5.7 percent, at $27.29 in midday trade.
"Recent checks indicate sell-through of Samsung LED TVs are tracking much better than anticipated given recent price drops," Vinh wrote in a research note.
The thin TV sets from Samsung were on track to sell 3.5 million to 4 million units this year, compared to an estimate of 2.5 million earlier, and back orders were building up as demand outstrips supply, he wrote.Vinh also said the introduction of new cell phones from Motorola Inc. based on Google Inc.'s Android operating system should boost revenue at Supertex's imaging business. Vinh expects earnings per share of 10 cents in the company's fiscal second quarter through September. That estimate is in line with analysts polled by Thomson Reuters. But he foresees full-year earnings of 53 cents per share on $60 million in revenue, higher than the average estimate of 44 cents per share on $62 million in revenue.