Stocks Under $10: Evaluating PMC-Sierra

Richard Suttmeier |

PMC-SierraPMC-Sierra (PMCS) – ($5.70) has been upgraded to a Buy rating according to ValuEngine with fair value at $6.78, which makes the stock 15.9% overvalued. The ValuEngine one-year price target is $6.12. ValuEngine Profile – “PMC-Sierra designs, develops, markets and supports high-performance semiconductor networking solutions. The company's products are used in the high speed transmission and networking systems which are being used to restructure the global telecommunications and data communications infrastructure. The company provides components for equipment based on Asynchronous Transfer Mode, Synchronized Optical Network, Synchronized Digital Hierarchy, T1/E1/J1 and T3/E3/J2 access transmission, High speed Data Link Control and Ethernet.”

Last week the company reported first quarter EPS at 3 cents a share missing estimates by 2 cents. The share price declined despite encouraging forward guidance.

Analysis – The daily chart for PMCS shows declining momentum with the stock below its 21-day, 50-day and 200-day simple moving averages at $6.45, $6.55 and $5.79. My quarterly value level is $5.12 with a semiannual risky level at $6.14.


Courtesy of Thomson / Reuters

Ticker

Company Name

Mkt Price

Fair Value

One-Year Price Target

Last 12-Mon Retn (%)

5-Yr Avg Retn (%)

P/E Ratio

PMCS

PMC SIERRA

5.70

6.78

6.12

-21.49

3.50

16.76

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Companies

Symbol Name Price Change % Volume
AAT American Assets Trust Inc. 44.21 0.18 0.41 101,671
PMCS PMC-Sierra Inc. n/a n/a n/a 0

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