Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why Sigma Designs, Inc. Shares Got Crushed

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of semiconductor company Sigma Designs, Inc.  (NASDAQ: SIGM  ) plummeted 18% today after its quarterly results and guidance disappointed Wall Street.

So what: The stock has slumped in recent months on concerns over slowing growth, and today's Q3 results -- EPS of $0.11 missed by $0.01 on a revenue decline of 15% -- coupled with downbeat guidance only reinforce those worries. In fact, management cited continued inventory tweaks and product cycle transitions for the weak outlook, suggesting that things aren't ramping up anytime soon. 

Now what: Management now sees Q4 revenue of $40 million to $44 million, well below the Wall Street consensus. "We have executed significant restructuring activities and delivered 3 consecutive quarters of profitability all while maintaining a very sizable cash balance and overall healthy balance sheet," founder and CEO Thinh Tran reassured analysts on a conference call. "As a result, we are well-positioned to begin returning value to shareholders while continuing to focus on design wins and further invest in our business and our next-generation products." Given Sigma's still rock-solid financial position and cheapish forward P/E, now might even be an opportune time to buy into that long-term bull talk.

More compelling growth picks
Tired of watching your stocks creep up year after year at a glacial pace? Motley Fool co-founder David Gardner, founder of the No. 1 growth stock newsletter in the world, has developed a unique strategy for uncovering truly wealth-changing stock picks. And he wants to share it, along with a few of his favorite growth stock superstars, WITH YOU! It's a special 100% FREE report called "6 Picks for Ultimate Growth." So stop settling for index-hugging gains... and click HERE for instant access to a whole new game plan of stock picks to help power your portfolio.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2762934, ~/Articles/ArticleHandler.aspx, 9/29/2016 9:50:22 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,326.16 -13.08 -0.07%
S&P 500 2,168.17 -3.20 -0.15%
NASD 5,309.51 -9.04 -0.17%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/29/2016 9:30 AM
SIGM $7.72 Down +0.00 +0.00%
Sigma Designs CAPS Rating: **