Piper Jaffray downgrades Advanced Micro Develpment (AMD ).
Analyst Richard Shannon cuts the stock to underperform from market perform and the company's $25 target to $15. He notes AMD expects its flash business to decline quarter-over-quarter, and its operating loss as well.
He suspects difficult pricing from Intel is the primary culprit. He is troubled that AMD took pains to describe how resilient its flash gross margins were to tough pricing last quarter, but apparently they did not hold up this quarter, calling into question if and when the flash business will get better.
Shannon notes AMD also implied processors were not as strong as expected either. He cuts his fourth-quarter earnings per share estimate to 5 cents, and 85 cents 2005 earnings per share to 40 cents.