Maxim Meets Lowered Estimates

Maxim Integrated Products (MXIM) reported earnings that matched expectations following last month’s pre-announcement. The company reported net revenues of $502.7 million for its fiscal first quarter ended September 23, 2006, a 1.5% decrease sequentially.

Although revenue declined, inventories rose 5.1%, in keeping with our thesis that there is too much capacity. Furthermore, property, plant and equipment (a proxy for manufacturing capacity) rose 7.9%, in keeping with our theory that the inventory situation is going to get worse.

Like this article? Why not try out:

•  RSS or email subscription to my free content

• Or buy my book: Understanding and Evaluating Prospectuses, Offering Documents, and Proxy Statements