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RF Micro Devices rises after 3Q results top Street

NEW YORK (AP) -- RF Micro Devices' stock climbed nearly 3 percent Wednesday after the chipmaker's third-quarter performance beat analysts' estimates and it provided a fourth-quarter revenue outlook above Wall Street's view.

THE SPARK: After the market closed Tuesday, RF Micro Devices Inc. reported a loss of a penny per share on revenue of $271.2 million. Adjusted earnings were 8 cents per share.

Analysts surveyed by FactSet predicted earnings of 6 cents per share on revenue of $245.7 million.

For the fourth quarter, the company expects adjusted earnings of about 4 cents to 5 cents per share on revenue between approximately $250 million and $255 million.

Wall Street was forecasting earnings of 4 cents per share on revenue of $228.4 million.

THE ANALYSIS: Cantor Fitzgerald's Dale Pfau said in a client note RF Micro Devices had a great quarter, beating his estimates for earnings of 6 cents per share and $247 million in revenue. The company's fourth-quarter revenue guidance also topped Pfau's forecast of $220 million, and he noted that the forecast implies a smaller seasonal decline than would be expected.

Pfau said RF Micro Devices is still his top pick in the semiconductor sector. The analyst reaffirmed a "Buy" rating and $8 price target.

Cody Acree of Williams Financial Group kept a "Buy" rating and $9 price target, saying its momentum should continue, in part because of its strong customer base that includes Apple and Samsung.

SHARE ACTION: Shares of RF Micro Devices Inc. gained 14 cents, or 2.9 percent, to $5.03 in afternoon trading. Over the last year, the stock has traded in a range of $3.45 to $5.45 per share.