Local technology companiess stocks got dinged by investors Thursday after a handful of analysts gave warnings about slowing demand for consumer electronics and the possibility of a chip glut.
Bernstein Research analyst Scott Geels said in a note to clients that PC and wireless chip inventories worsened considerably in the fourth quarter, according to an Associated Press report.
Geels said that the slowdown is simply the “first emerging crack in the demand/inventory picture” and said the situation should get worse in the next few quarters, according to the report.
Jefferies & Co. analyst John Lau, in a note on North Carolina’s RF Micro Devices Inc., warned that the Chinese cell phone market is weakening in part because of a buildup in stocks of older models of cell phones.
Chipmaker Intel Corp., a bellwether for the sector, saw its shares creep downward since Wednesday, after an analyst cited impending inventory problems and cut his first quarter revenue targets for the company.
Local tech stocks followed suit, including Irvine chipmaker Broadcom Corp. and Lake Forest disk drive maker Western Digital Corp.
Broadcom’s shares fell more than 4% before the close of New York trading and continued to slip afterhours.
The company, which has seen its stock fall some 30% in the past three months, had a recent market value of about $10 billion.
Western Digital saw shares fall nearly 5% on a recent market value of $7 billion.
Unlike Broadcom, Western Digital has been on a tear lately.
It upped its outlook for the March quarter on Wednesday and has seen its stock soar more than 26% in the past three months.
