Shares of

Silicon Laboratories

(SLAB) - Get Report

plummeted Tuesday as analysts rushed to downgrade the shares in the wake of reduced earnings guidance.

The stock fell $6.86, or 20%, to $27.58 in early trading, piercing its 52-week low of $29.02 on heavy volume. Deutsche Bank lowered its investment rating on the shares to hold from buy Tuesday morning.

After the bell Monday, the semiconductor maker said third-quarter earnings surged 51% from last year to $21 million, or 39 cents a share, on a 46% rise in revenue to $121 million. The results were in line with estimates.

Traders, however, concentrated on the company's guidance for the fourth quarter, which called for revenue of $93 million to $97 million. Analysts had been expecting more like $126 million.

"We are taking a very cautious view on the industry in the fourth quarter," Silicon Labs said. "We believe that uncertainty in the outlook for the world's economy along with an excess of semiconductor supply will result in softness in the major markets we serve.

"We believe that it will take time for our customers to bring the supply chain into balance and for end market demand visibility to improve," the company said.