S&P Downgrades Affymetrix Stock from HOLD to STRONG SELL, Target Price Reduced

October 10 00:00 2011

NEW YORK, Oct 10 (RainbowNewsLine.com) – Analyst Jeffrey Loo of S&P Equity Research downgraded Affymetrix Stock (NASDAQ: AFFX) from HOLD to STRONG SELL, while reducing his estimates for the company. The target price has been reduced from $6 to $4.

Analyst Jeffrey Loo of S&P Equity Research, in a research note published on October 7, mentions that soft sales for the company is expected following the evaluation of competitor Illumina’s preliminary Q3 report of softness caused on account of uncertainties in government funding. The analyst visualize similar pattern in 3Q sales of AFFX as it has a substantial government funded end-market. Such uncertainty is expected to carry on in Q4 as well, however, two key Senate sub-committees passed a NIH budget proposal with 0.6% decline, which is better than 2-3% decline as projected before, the analyst says. The initial drop of 8% in 3Q sales is revised to a wider decline of 14%. The analyst has reduced 2011 EPS from $0.13 to a loss of $0.14.