California-based Zoran Corporation (ZRAN) is a leading provider of digital solutions for applications in the growing digital entertainment and digital imaging markets. Zoran develops and markets integrated circuits (ICs), integrated circuit cores and embedded software used by original equipment manufacturers (OEMs) in digital video and audio products.
On January 6, 2009, Zoran announced the release of digital entertainment and digital imaging platforms and technologies for consumer electronics manufacturers. Zoran released new HDTV (SupraHD); COACH-based digital camera designs; the VaddisHD High Definition Multimedia Processor platform that supports Blu-Ray, HQ-DVD and TVMM DVD players; and SupraXD system solutions for
selected Pay-satellite and IPTV set-top box markets, to name a few.
Zoran is facing significant pricing pressure in all its verticals and lower booking levels. The guidance for a significant slowdown in business activity was well below the analyst consensus. We lower our estimates for the remaining of 2008 as well as 2009.
On a positive note, cash flow excluding acquisitions has been positive, and total cash should provide a buffer to further declines in stock prices. Our price target is reduced to $13.00 and our recommendation is a BUY.
Priyanka Poddar contributed to this report.
Read the full analyst report on ZRAN.
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