Shares of TriQuint Semiconductor Inc. plunged Thursday after the mobile phone chip make's third-quarter revenue fell below estimates and it said a key customer was cutting orders.
Shares were down $2.13, or 26 percent, at $5.97 in afternoon trading. The stock has traded between $1.67 and $8.59 in the last 52 weeks.
TriQuint said its revenue slid 7 percent to $173 million, below analyst expectations of $178 million. Its adjusted earnings of 10 cents per share was in line with forecasts.
It predicted fourth-quarter adjusted earnings of 10 cents to 12 cents per share, with revenue between $175 million and $185 million.
Analysts projected income of 13 cents per share on sales of $188 million in the fourth quarter, according to a Thomson Reuters survey.
D.A. Davidson & Co. analyst Aalok Shah on Thursday downgraded TriQuint to "Neutral" from "Buy." He cited concerns that a Korean customer — possibly Samsung — was cutting orders to use up inventory.
"While less than a 10 percent customer, we think Samsung's weakness could spill over into other names," Shah wrote in a research report.
Shah said he was also "particularly perturbed by the lack of handset revenue growth" in the third quarter.
Shah cut his price target for TriQuint shares to $7 from $10 and lowered his 2010 earnings-per-share forecast to 50 cents from 57 cents.
Craig-Hallum Capital analyst Anthony Stoss, however, called Thursday's sell-off "an attractive entry point" to buy TriQuint shares. He maintained a "Buy" rating and a $9 price target.
He said while Samsung apparently cut its orders by 50 percent in the last two weeks, it would be back for more in the quarter ending in March.
"While this is not ideal, we point to the fact that this is only one customer, and not a commentary on overall demand," Stoss wrote in a research note.