J.P. Morgan Overweight On Avid Technology (AVID)

J.P. Morgan Chase & Co. has an Overweight rating and a $25 price target on shares of Avid Technology AVID after it reported earnings. In a note to clients, J.P. Morgan writes, "AVID reported slightly disappointing 1Q earnings on solid revenue, but ticked off another solid quarter of improving y/y financial performance, consistent with our turnaround thesis. Guidance for 2011 was reaffirmed, meaning that AVID is targeting 5% PF operating margins in 2011 on sales growth of 3-6%, which we think is conservative. We are trimming 2011 EPS by $0.06 to reflect weaker earnings in 1Q offset by adjustments to non cash expenses, including a larger PF Tax adjustment than we anticipated. Our thesis remains unchanged; that AVID is experiencing a modest cyclical recovery in demand, enhanced by new product cycles, and operating leverage will exceed expectations later this year, encouraging upward revisions to consensus estimates. Our December 2011 price target remains $25. Maintain Overweight rating." Shares of AVID are down $2.59 this morning to $18.73, a loss of 12.15% so far on just over 400,00 shares.