RF MICRO DEVICE (RFMD)

Introduction RF Micro Devices (RFMD) is a stock on a mission these days. An explosive fiscal third-quarter earnings report was rewarded in the market with new 52-week highs for the stock. Full Analysis RF Micro Devices, Inc. (RFMD) designs, develops, manufactures and markets radio frequency integrated circuits for rapidly growing wireless communications products and applications. Its products are included in cellular and PCS phones, cordless phones, wireless local area networks, wireless local loop handsets, industrial radios, wireless security systems and remote meter readers. On Jan 24, 2006, RFMD, a Zacks #1 Rank stock, delivered a 14.3% earnings surprise over consensus estimates for the December quarter. RFMD reported earnings of eight cents versus two cents last year, an increase of 300%. Sales growth was 38.3%. This was the eighth out of the last eleven quarters that RFMD delivered a positive earnings surprise. During that period RFMD has never disappointed in earnings. The day after the report, RFMD gapped higher and closed the day up 15.9%, while also setting a new 52-week high on volume more than two times the three-month average volume. RFMD has clearly broken out to the upside. A key determinate of the power of this move to the upside will be how well the support at 6.72 holds. So long as RFMD remains above this level, and the major trend indicators remain in buy mode, the likely direction will be higher. RFMD’s long-term indicators have indeed turned higher, especially the Moving Average Convergence Divergence (MACD) indicator, which remains in an uptrend of its own, which began last October. RFMD remains above both its 50- and 200-day moving averages and those averages maintain a positive slope. This confirms the upward trend of the price action. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. The ranks are updated every Monday morning on Zacks.com. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. http://www.zacks.com/rank/index.php?id=2118

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