Intellon a Smart Pick-up

Intellon Corporation (ITLN) is a fabless semiconductor company that designs, develops, manufactures, and markets integrated circuits (ICs) for powerline communications or high-speed communications over existing electrical wiring. September top- and bottom-line results met consensus estimates as home networks continue to grow.

Margins are trending up and we see the string of quarterly losses ending in the second half of 2008. The weak macro environment could provide a short-term tail wind as homeowners may upgrade home networks in lieu of taking vacations.

We rate the stock a Buy and adjust our price target of $5.00. Regardless of the short-term tail wind, Intellon Corp. should outgrow the broader semiconductor market. Our price target represents a 27.7x multiple to 2009 earnings.

Read the full analyst report on ITLN.

Read the full analyst report on ITLN