Applied Micro Circuits (AMCC) was down 7.2% in preopen Island trading after Goldman Sachs downgraded it and two other communications chipmakers to market outperform from trading buy.

Also downgraded were

PMC Sierra


, down 6.2% preopen, and



, down 5.6%. Analyst Ed Canaday said high valuations, limited visibility and a lack of near-term catalysts will likely cause the trading range for the stocks to head lower in the near-term. Canaday also lowered his estimates for the three companies.