DDI Stocks Lead Rebound After Midweek Sector Dip

Shares of DDI Corp. climbed nearly 24% Friday, leading a rebound by several printed circuit-board makers whose stocks had plummeted earlier in the week when a rival disclosed a negative business outlook.

Analysts said Anaheim-based DDI doesn’t necessarily fall into the same category as rival Merix Corp., which said Wednesday the sector was experiencing a general economic slowdown and was “cautiously optimistic” that its fourth-quarter sales and earnings would meet the low end of analysts’ estimates.

Stock prices in the entire sector responded by plummeting. But the message of the day Friday was that the sell-off was unwarranted.

DDI’s stock moved up $3.13 to $16.38 a share in Nasdaq trading. Shares of Merix were up 5.8%, while TTM Technologies Inc. rose 19% and Park Electrochemical Corp. was up 13%. Other industry gainers included Tyco International, up 5%, and Sanmina Corp., up 2.6%.

Analysts said DDI has a reputation for quick turnaround in manufacturing its printed circuit boards. The printed circuit boards and other electronics products are offered at a premium cost, and orders take anywhere from one to six days for DDI to fill.

“Although DDI is not immune to end-market softness, we stress that its vast customer base of 2,000, as well as its focus on quick-turn and prototype production [of printed circuit boards], makes them less vulnerable to long-lead-time order cancellations,” wrote Herve Francois, an analyst with Credit Suisse First Boston Corp., in a recent note.

DDI’s customers include cell-phone makers L.M. Ericsson Telephone Co., Qualcomm Inc. and Motorola Inc.; computer router maker Cisco Systems Inc.; and personal computer manufacturer International Business Machines Corp.

Alcatel SA is DDI’s biggest customer.

Since going public in April, DDI has expanded operations in Europe and made several acquisitions. Early this month, its European unit bought Thomas Walter Ltd., a circuit-board manufacturer in Marlow, England.