Ahead of the Bell: NetLogic downgraded

AP News
Posted: Jan 04, 2010 8:40 AM

Shares of NetLogic Microsystems Inc. may take a breather after a strong run, a Kaufman Bros. analyst said Monday, downgrading the stock.

In a client note, Kaufman's Suji De Silva said the company's shares are fairly valued. The stock has more than doubled over the past year. De Silva downgraded the stock to "Hold" from "Buy."

NetLogic shares were down 26 cents to $46 in premarket trading Monday.

Still, De Silva said he expects the company to meet or exceed his own forecasts when it reports financial results for the fourth quarter of 2009. He projects earnings of 42 cents per share on sales of $61.5 million, roughly in line with forecasts of analysts surveyed by Thomson Reuters.

De Silva said NetLogic should get a boost from a better-than-expected recovery in demand for wireless infrastructure chips and "steady" demand in business network demand.