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From Briefing.com: 5:58PM Thursday After Hours prices levels vs. 4 pm ET: The after hours has firmed following several positive earnings pronouncements from noteworthy firms. Presently, the S&P futures, at 1142, are 3 points above fair value, and the Nasdaq 100 futures, at 1495, are 4 points above fair value.

The below table lists the most notable developments of the evening.

Company Stock Move Reason for Move
Forest Labs (FRX) 56.60 -0.95 (-1.7%) Specialty pharmaceutical maker says that a study conducted by its European partner found its antidepressant drug Lexapro no more effective than a placebo in children; The study is the latest in a controversy over whether drug companies have suppressed negative study results in kids with depression; Last month, Eliot Spitzer opened an investigation of GlaxoSmithKline (GSK), charging that the company may have withheld data from tests that show the dangers of antidepressant use by children

Nike (00C) 74.25 +1.85 (+2.6%) Athletic apparel company delivers a 23% increase in Q4 (May) EPS to $1.13 (consensus of $1.08) and a 17% rise in revenues to $3.49 bln (consensus of $3.31 bln); According to CEO Phil Knight, revenues and EPS grew at their best rate in 5 years; Gross margins - at 23% - were the highest in Nike's history; Briefing.com has been positive on NKE in our Story Stocks page for over a year; Stock is up 28%

Paychex (PAYX) 35.40 -1.29 (-3.5%) Payroll processor misses the Q4 (May) Reuters consensus estimate by a penny, coming in at $0.20 (year/year growth of 5%); Revenues, however, rose 14% to $330.4 mln (consensus of $329.6 mln); Legal expenses increased greatly due to a dispute over a software license agreement at its Rapid Payroll unit; Company's primary competitor in the US, ADP, is down 2% tonight

Silicon Image (SIMG) 11.70 +1.46 (14.3%) Semiconductor company raises its Q2 (June) revenues guidance, saying it will grow 16-20% sequentially versus 8-13% earlier; The forecast brings the sales range to $41.6-43.1 bln (consensus of $39.8 bln); Management added 'our bookings remain strong and we expect Q3 (Sept) revenues to grow 5-10% sequentially over the raised Q2 (June) numbers;' This is the second consecutive quarter Silicon Image has increased its targets

Verity (VRTY) 12.40 -0.36 (-2.8%) Small-cap software name shows upside to the Street's top and bottom-line estimates in its Q4 (May) report, but issues weaker than expected EPS guidance for Q1 (Aug); Company said it sees EPS of $0.04-0.07 (consensus of $0.10) on revenues of $33-35 mln (consensus of $32.6 mln); This is the second quarter in a row Verity has cut its EPS forecasts; Stock is trading below its 50 and 200-day simple moving averages

Tomorrow, the revision to final Q1 GDP, June Michigan Consumer Sentiment, and May Existing Home Sales are all due out. There are no earnings reports scheduled to be released.

For more detail on these, and other developments, be sure to visit our Stock Market Update and Daily Sector Wrap. -- Heather Smith, Briefing.com

6:13PM Amgen receives positive results on Neulasta (AMGN) 54.61 +0.39: Co announced data from a Phase 3 study showing that administration of Neulasta in the first and subsequent cycles of chemotherapy significantly lowers the rate of infection, as manifested by febrile neutropenia, hospitalization and the use of intravenous anti-infectives in breast cancer patients receiving moderately myelosuppressive chemotherapy. The results will be presented by one of the study's lead investigators, Lee Schwartzberg, M.D., medical director of The West Clinic, Memphis, Tenn., in a plenary session tomorrow at the Multinational Association of Supportive Care in Cancer (MASCC) Annual Meeting.

11:32AM Gold tops $400 for first time in 2 months : Gold stocks are very strong today as gold traded above $400 per ounce for the first time in two months. Gold is being helped by recent weakness in the dollar due to an unexpected decline in durable goods orders and a rise in initial jobless claims. RGLD +7.0%, EGO +5.9%, BGO +5.2%, CDE +4.3%, GLG +3.7%, KGC +3.6%.... A small cap name worth a look is Gammon Lake Resources (GRS 6.96 +0.16), a Nova Scotia based exploration co with properties in Mexico. The chart looks strong as it's been showing a strong uptrend going back to last fall and has avoided the choppiness of many other gold stocks. Also, the co was recently added to the S&P/TSX Composite Index, the S&P/TSX Small Cap Index and the Global Industry Classification Standard Sector Materials Index. Also, the stock is liquid with a 250K avg daily volume. Mkt cap $364 mln, float 40 mln.

10:37AM Xyratex IPO prices below range (XRTX) 14.00: Britain's Xyratex, which provides data storage and storage process technology, prices its IPO at $14, below the expected $15-$17 range. The co sells its Storage and Network Systems products exclusively to OEMs. The co has long-term, strategic relationships with its customers, which include Network Appliance, Seagate and Western Digital. These three customers comprised 78% of sales last year... The co has posted strong revenue growth, having increased sales from $83.6 mln in FY99 to $333.8 mln last year, for a CAGR of 41.4%. With 28 mln shares outstanding, the co's market cap is $392 mln, or just 1.2x sales. The low price/sales valuation appears to be a results of fairly thin margins and that the co is just barely profitable, excluding non-cash equity compensation. As a side note, it's probably worth keeping an eye on XRTX when any up/downside guidance is announced by this co's customers (NTAP, STX, WDC) due to its concerntration of sales to these customers.... This is a 7 mln share deal, led by CSFB and will begin trading this morning.

3:21PM Micron Technology (MU) 14.40 -0.06: Micron Technology printed Q3 EPS of $0.13 on revenue of $1.117B (+52.4% Y/Y) vs. Reuters Research consensus at $0.07 on $1.132B.

Gross margin increased 2,504 bps Y/Y to 34.7%, driven by increases in average selling prices across product lines. Operating margin increased 3,433 bps Y/Y to 10.0%.

The following table shows price multiples and Y/Y growth rates for MU compared against the semiconductor components group. Company *P/SG Ratio **P/OPG Ratio P/S Y/Y Rev Growth (%)
TTM 2004E 2005E TTM 2004E 2005E
Micron Tech (MU) 1.6 (27.7) 2.1 1.9 1.5 39.1 45.7 22.9
Cypress Semi (CY) 1.0 25.9 1.8 1.5 1.3 19.4 30.4 15.2
Infineon Tech (IFX) 0.8 103.0 1.2 1.3 1.2 17.9 (0.6) 12.5
Advanced Micr Dev (AMD) 0.6 (70.2) 1.3 1.0 0.9 61.0 48.4 11.6
Atmel (ATML) 1.2 n/a 1.8 1.5 1.3 18.7 33.2 13.5
Intel (INTC) 3.0 13.9 5.8 5.2 4.7 17.8 14.3 10.7
ESS Tech (ESST) 1.3 7.2 1.8 1.3 1.1 5.0 73.3 19.9
National Semi (NSM) 3.1 22.4 3.8 3.1 2.8 18.6 46.9 11.3
OmniVision Tech (OVTI) 0.8 3.7 2.7 1.9 191.9 41.4
Ramtron (RMTR) 1.7 (16.1) 2.3 n/a (7.9) n/a
STMicroelectronics (STM) 1.5 59.7 2.5 2.1 1.9 16.2 23.9 13.6
Texas Instruments (TXN) 2.3 24.2 3.9 3.2 2.7 20.9 32.3 15.8
Zoran (ZRAN) 1.2 (11.2) 2.9 1.9 1.6 66.3 77.2 20.2
Semiconductor Components 2.5 29.6 4.2 n/a 18.3 n/a
*P/SG Ratio: Normalized trailing 12 month (Price / Sales) / Growth ratio as of June 18, 2004.
**P/OPG Ratio: Normalized trailing 12 month (Price / Operating Income) / Growth ratio as of June 18, 2004.

Good quarter. Revenue momentum should continue to build over the next few quarters, driven by recovery in end markets, and the ramping of production for over a dozen digital still camera design wins as well as a number of mobile phone design wins. The company is positioned to materially improve margins over the coming quarters due to migration to advance process technologies, and scale economies on existing and new products including CMOS image sensors. MU shares trade at a modest discount to peers and, based on our inverted EVA/DCF model, are priced for sustained upper teens revenue growth from F06 assuming 30% operating margin.--Ping Yu, Briefing.com

2:12PM ATI Technologies (ATYT) 18.41 +1.62: ATI Technologies reported Q3 results before the open. The designer of 3D graphics and digital media silicon solutions printed EPS of $0.19 on revenue of $4931.457 (+38.2% Y/Y) vs. Reuters Research consensus at $0.17 on $459.53MM.

Results driven by strength in notebook discretes, consumer products, DTV and hand-held products. Company claims a 73% share of the notebook discrete market, 36% of the desktop discrete, and a greater than 50% share of the overall market.

By product segment, components revenue increased 60.5% Y/Y to $389.596MM (79% of sales); boards declined 20.4% to $87.703MM (18% of sales); other increased 406.5% to $14.158MM (3% of sales). By geography, Asia-Pacific revenue increased 56.3% Y/Y to $409.691MM (83% of sales); U.S. increased 1.4% to $65.641MM (13% of sales); Europe declined 59.5% to $10.030MM (2% of sales); Canada increased 51.8% to $6.095MM (1% of sales).

Gross margin increased 270 bps Y/Y to 35.3%. Operating margin, excluding extraordinary items, increased 506 bps Y/Y to 12.5%.

Guided for Q4 revenue of $510-550MM (approximately +40.0-44.5% Y/Y). Consensus is at $0.19 on $486.31MM. Gross margin is expected to be in the upper half of target range of 32-35% for Q4 and to trend between 34-38% over the long-term.

The following table shows price multiples and Y/Y growth rates for ATYT compared against peers in the semiconductor and computer systems & peripherals groups. Company *P/SG Ratio **P/OPG Ratio P/S Y/Y Rev Growth (%)
TTM 2004E 2005E TTM 2004E 2005E
ATI Technologies (ATYT) 1.7 22.1 2.2 2.0 1.9 47.1 42.6 7.4
Broadcom (BRCM) 3.0 (55.5) 7.6 5.5 4.6 58.4 60.5 19.7
Conexant (CNXT) 1.0 (16.0) 2.8 1.8 1.5 34.1 89.4 23.3
Creative Technology (CREAF) 0.7 18.0 1.3 n/a 3.8 n/a
nVidia (NVDA) 1.2 38.8 1.8 1.6 1.5 9.1 14.3 7.2
Intel (INTC) 3.0 13.9 5.8 5.3 4.8 17.8 14.2 10.7
LSI Logic (LSI) 1.1 (23.1) 1.6 1.5 1.3 (0.3) 14.1 12.1
STMicroelectronics (STM) 1.5 59.7 2.5 2.1 1.9 16.2 23.9 13.6
Texas Instruments (TXN) 2.3 24.2 3.9 3.2 2.7 20.9 32.3 15.8
Trident Microsystems (TRID) 4.2 n/a 5.8 5.9 4.0 (8.0) 2.5 48.2
Zoran (ZRAN) 1.2 (11.2) 2.9 1.9 1.6 66.3 77.2 20.2
Semiconductors 2.5 29.6 4.2 n/a 18.3 n/a
Computer Systems & Peripherals 1.0 17.6 1.5 9.5
Blended 1.5 21.1 2.3 12.0
*P/SG Ratio: Normalized trailing 12 month (Price / Sales) / Growth ratio as of June 18, 2004.
**P/OPG Ratio: Normalized trailing 12 month (Price / Operating Income) / Growth ratio as of June 18, 2004.

ATYT shares have risen almost 26% since December, trade at a modest discount to peers and, based on our inverted EVA/DCF model, are priced for sustained upper 30% revenue growth from F06 assuming 19-20% operating margin.

Expectations are relatively high but see only modest downside risk given that the company is well positioned to capitalize on the transition to PCI Express. Multiple OEMs, including Dell, Gateway, Hewlett-Packard, IBM and NEC Packard Bell have already selected ATYT products for their PCI Express platforms. Overall, growth is expected to be paced by a number of new desktop and notebook products slated for the market this fall, the conversion to full high definition solutions in the digital TV market, and the growth of multi-media enabled phones in the handset market. Operating margins should continue to improve as the company migrates to 0.13µ, 0.11µ and 90nm process technologies, due to scale economies, and from increased royalties from partners including Qualcomm.

We continue to think ATYT can command a premium valuation given the above average growth rate for the space, emerging product and geographic market opportunities, and the company's improving competitive position, and would continue to add on weakness.--Ping Yu, Briefing.com

9:31AM OmniVision (OVTI) 16.06: OmniVision reported Q4 results after the close. The designer of CMOS-based image sensors used in products including camera phones, digital still cameras, bar codes, security systems, and automotive and medical devices published EPS of $0.34 on revenue of $99.673MM (+149.5% Y/Y) vs. Reuters Research consensus at $0.32 on $101.65MM.

The company shipped 20.9MM (+20.1% Q/Q) CameraChips in Q4, up from 10.7MM in Q3. Sales to original equipment manufacturers accounted for 80% of sales; distributors 20%. Camera phone revenue accounted for over 60% of sales. Camera phone shipments are still predominantly VGA but sales of new 1.3 megapixel products are increasing. Digital still camera revenue accounted for approximately 20% of sales.

Gross margin increased 181 bps Y/Y to 40.3% due to improved production yields despite average selling prices declining Q/Q from $5.38 to $4.76. Operating margin increased 772 bps Y/Y to 30.1%.

Guided for Q1 EPS of $0.29-0.31 on $95-100MM (+104.3-115.1% Y/Y) vs. consensus at $0.32 on $103.65MM.

Audit committee and independent legal counsel found errors principally with the timing of revenue recognition for certain sales. but no evidence of wrongdoing. Company reports revenue on a sell-through basis; errors due to one distributor delaying reporting of sales, and the recording of revenue based on delivery to customer rather than upon shipment of products.

The following table shows price multiples and Y/Y growth rates for OVTI compared against peers and the semiconductor components group. Company *P/SG Ratio **P/OPG Ratio P/S Y/Y Rev Growth (%)
TTM 2004E 2005E TTM 2004E 2005E
OmniVision Tech (OVTI) 0.8 3.7 2.7 1.9 191.9 41.4
Agilent (A) 1.2 203.4 1.9 1.7 1.6 10.7 19.4 10.7
ESS Tech (ESST) 1.3 7.2 1.8 1.3 1.1 5.0 73.3 19.9
Micron Tech (MU) 1.6 (27.7) 2.1 1.9 1.5 39.1 45.7 22.9
National Semi (NSM) 3.1 22.4 3.8 3.1 2.8 18.6 46.9 11.3
STMicroelectronics (STM) 1.5 59.7 2.5 2.1 1.9 16.2 23.9 13.6
Zoran (ZRAN) 1.2 (11.2) 2.9 1.9 1.6 66.3 77.2 20.2
Semiconductor Components 2.5 29.6 4.2 n/a 18.3 n/a
*P/SG Ratio: Normalized trailing 12 month (Price / Sales) / Growth ratio as of June 18, 2004.
**P/OPG Ratio: Normalized trailing 12 month (Price / Operating Income) / Growth ratio as of June 18, 2004.

Shares trade at a discount to peers and, based on our inverted EVA/DCF model, priced for sustained upper teens growth from F06 assuming static operating margin. We would continue to accumulate.

Worldwide shipments of mobile phones are expected to exceed 500MM in 2004. The attach rate of cameras to phones is over 90% in Japan, 60% in Korea, 30% in Europe and negligible in the U.S. and the rest of the world. CMOS-based image sensors used in cameraphones are expected to grow from approximately 14MM units in 2002 to 99MM units in 2007 (47% CAGR) according to iSuppli. Worldwide shipments of cameraphones are forecast to increase from approximately 20MM in 2002 to approximately 300MM in 2007 (70% CAGR) according to IDC.

OVTI has captured over 100 camera phone design wins but is shipping to very few customers in Japan and has yet to ship to Nokia. Japan-based firms and Nokia together account for over 50% of the market for mobile phones.

CMOS-based image sensors used in digital still cameras are forecast to grow from approximately 8MM units in 2002 to 42MM units in 2007 (39% CAGR) according to iSuppli.--Ping Yu, Briefing.com

http://biz.yahoo.com/mu/story.html