Sector Snap: Chip stocks up, inventory trends seen improving

Friedman Billings Ramsey analyst Mehdi Hosseini said that a legal dispute with competitor Amkor Technology Inc. is keeping down share prices for chip testing company Tessera Technologies Inc.

Despite some positive fundamentals, the legal issues are the most important catalyst in the near term and are weighing heavily on the stock, he said.

He said he would remain on the sidelines until there is more information available. He lowered his 2008 profit estimate to 80 cents per share from $1.15 per share but raised his sales estimate to $235.5 million from $225 million.

Shares of the San Jose, Calif.-based company fell 14 cents to $18.60 in afternoon trading.