Micro-Cap Symmetricom (SYMM) Explodes on Microsemi (MSCC) Acquisition

NEW YORK (TheStreet) -- Micro-cap clock technologies developer Symmetricom (SYMM) has doubled in morning trading, following the news a day earlier of a buy-out from Microsemi (MSCC). Symmetricom shares exploded 51.4% to $7.22, while Microsemi climbed 3.8% to $26.52 as of 9:45 a.m. EDT.

Microsemi, a semiconductor manufacturer, offered Symmetricom $7.18 a share (a 50% premium on Monday's close), or $230 million in an all-cash deal. The combined companies will create the industry's largest end-to-end precise timing portfolio.

"From source to synchronization to distribution, Microsemi will offer an end-to-end timing solution for an expanded range of markets, driving increased dollar content opportunity and revenue growth," said James J. Peterson, Microsemi's CEO, in a statement on the acquisition.

Microsemi anticipates an additional 22 cents to 25 cents to its full-year 2014 earnings as a result of the acquisition. Analysts currently expect $1.36 a share for FY14, according to Thomson Reuters.

TheStreet Ratings team rates Microsemi Corp as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate Microsemi Corp (MSCC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, expanding profit margins, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

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