Small Chip Maker Has Big Opportunities: Tech Analyst

Atheros Communication’s shares are up more than 170 percent for the year, outperforming the semiconductor index. The chip maker beat the Street in fourth quarter earnings and its revenue is up 89 percent from the year prior, reaching a new record.

Craig Berger, senior semiconductor analyst at FBR Capital Markets, shared his outlook for the company.

“The easy money has been made in it, but this is still a very good executing company, it’s relatively small and they’re attacking some pretty large and growthy markets,” Berger told CNBC.

“So there is a lot of opportunities, depending on whether the company can continue to take market share in key markets.”

Berger has a $39 price target on the firm and a “market perform” rating.

Although Atheros is smaller relative to its competitors, Berger said the possibility of a buyout is slim.

“A buyout is less likely because that is a hypercompetitive market,” he explained. “There are still 5 or 6 players, and it’s a very fast moving market—they’d have to pay a pretty hefty premium to take them out.”

• Watch Berger's Previous Appearance on CNBC (Jan. 29, 2010)

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Atheros Competes With:

Broadcom

Intel

Marvell Technology

Texas Instruments

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Disclosures:

Berger does not own shares of ATHR.

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Disclaimer