Intel trades mixed after guidance cut; Microchip slips on hedge; Synchronoss adds outright

By Rebecca Melvin

New York, March 12 – Chip giant Intel Inc.’s convertibles were mixed Thursday as shares slipped after the Santa Clara, Calif.-based company cut its first-quarter revenue outlook, citing lower-than-expected demand and lower PC supply chain inventory levels.

The negative news wasn’t affecting other convertible semiconductor names significantly, a New York-based trader said. “There’s some small stuff, but nothing to speak of.”

Microchip Technology Inc. came in a little bit amid disappointment that the Chandler, Ariz.-based semiconductor maker didn’t get the investment-grade rating that the markets were hoping for, the trader said.

Standard & Poor’s said it assigned an unsolicited BB+ corporate credit rating on Microchip and a BB- rating on the Microchip 1.625% convertibles, of which $1.5 billion priced last month.

The rating on the convertibles came with a 6 recovery rating to the company’s convertibles, which are due 2025, and the 2.125% junior subordinated convertible notes due 2037. The 6 recovery rating indicates 0 to 10% expected default recovery.

Elsewhere, Synchronoss Technologies Inc.’s convertibles traded about a point higher as shares of the Bridgewater, N.J.-based provider of connectivity services for mobile devices rose 7%.

FBR Capital Markets put out a favorable research note on Synchronoss, citing the potential of the company’s cloud growth engine.

Equities rebounded higher on Thursday as a rally in the U.S. dollar subsided. The Standard & Poor's 500 index climbed 25.71 points, or 1.3%, to 2,065.95.

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