In addition to Intel Corp.'s (NASDAQ: INTC) third quarter earnings release, chip makers Altera Corp. (NASDAQ: ALTR) and Linear Technology Corp. (NASDAQ: LLTC) are expected to post results Tuesday after the market closes as well. (Also see our Intel earnings preview.)

For the three months that ended in September, analysts surveyed by Thomson Reuters expect Altera to report that its net income fell 38.7% from a year ago to $0.19 per share. Revenue for the period is expected to be 20.6% lower to $283.3 million, which is in line with recently raised guidance. Altera has met or topped earnings estimates in the past five quarters, beating by as much as a nickel per share. The long-term EPS growth forecast is 14.4%, which is better than that of competitors Intel and Texas Instruments Corp. (NYSE: TXN).

After the closing bell tolled yesterday afternoon, chipmaker Altera (NASDAQ: ALTR) announced that its profit fell 52% in the second quarter. The chipmaker's profit was pushed lower thanks to falling sales and increasing taxes. During the quarter, ALTR saw net income decrease to 16 cents per share compared to last year's 32 cents per share. While the results fell short of those from a year ago, ALTR managed to match the consensus estimate of 16 cents per share. Revenue dropped to $279.2 million from $359.9 million a year ago - estimates called for $277.6 million in revenue. According to the company, a court ruling increased ALTR's tax costs by four cents per share. The court ruling stemmed from worldwide equity compensation cost sharing, and although the company wasn't involved in the case, it decided to increase its tax responsibilities.

Xilinx (NASDAQ: XLNX), a tech entity involved in programmable logic and a colleague of companies like Actel (NASDAQ: ACTL) and Altera (NASDAQ: ALTR), issued a business update on Tuesday. Believe it or not, it contained some good news. How about that for a change? I'm sure shareholders were pleased.

According to this news item, Xilinx believes that its revenue picture should be better than previously thought. Sales should drop by somewhere between 13% and 18% for the March quarter on a sequential basis. Management had originally believed that they'd have to report a sequential revenue drop between 15% and 25%. So, yes, there will still be a decline, but hey, if it's less than expected, you gotta take that. It's too bad, though, that the gross margin range wasn't raised. It should still fall between 61% and 63%. If management had raised that as well, then I bet the stock would have closed even higher on the news. It rose almost 4% on better-than-average volume yesterday.

Tomorrow, semiconductor chip makers Intel Corp. (NASDAQ: INTC) and Altera Corp. (NYSE: ALTR) are both expected to report profit growth in the third quarter.

Intel is expected by analysts surveyed by Thomson Financial to report earnings of 34 cents per share, 8.8% higher than the same period of last year, on revenue of $10.3 billion. The company has missed estimates in two of the past three quarters, but beat by 10.2% in the second quarter.

Based in Santa Clara, Calif., Intel is the world's largest chip maker, and generates half its revenues from Asia/Pacific. In the past year, the company's revenues were $38.3 billion and its net income totaled $6.9 billion. Its long-term EPS growth forecast is 11.9%, which is less than the S&P, as well as that of rival Advanced Micro Devices Inc. (NYSE: AMD). The consensus recommendation of analysts has recently shifted from hold to buy Intel.

The share price has fallen 17.7% in the past three months, and closed Monday at $16.99, up 11.9% in the day's big rally.

The earnings crunch begins in earnest this coming week, with companies from Johnson & Johnson (NYSE: JNJ) and PepsiCo Inc. (NYSE: PEP) to Southwest Airlines Co. (NYSE: LUV) and Harley-Davidson Inc. (NYSE: HOG) scheduled to report results for the quarter just ended. But with the ongoing turmoil in the markets, much attention is on the tech and financial sectors. This week will provide plenty to mull over on both counts.

Wall Street expectations for tech stocks are fairly optimistic. Analysts surveyed by Thomson Financial are looking for chip maker Altera Corp. (NASDAQ: ALTR) and software/service company iGate Corp. (NASDAQ: IGTE) to be the sector's biggest earnings gainers of the week. Altera is expected to report earnings of 30 cents per share (up 33.3% from a year ago) on revenue of $355.1 million. Altera had previously forecast flat sales for the quarter, and shares fell to a 52-week low last week. iGate is expected to report earnings of 14 cents per share (up 42.9%) on revenue of $55.6 million. India-based iGate recently spun off its Mastech consulting services. Shares are down 45.0% in the past three months, and also reached a new 52-week low last week.

San Jose-based Novellus Systems Inc. (NASDAQ: NVLS), on the other hand, is expected to report that net income tumbled 90.4% from a year ago to 4 cents per share, on revenue of $245.6 million. Novellus fell to a 52-week low early last week, and shares are down 44.5% year to date.

This post is part of a report entitled "Six-pack of technology favorites." You can read about the other top tech stock picks here.

"The semiconductor industry has been under pressure now for sometime, but one of the fastest growing businesses within semiconductors has been in programmable logic devices (PLDs)," notes wireless sector specialist Nikhil Hutheesing.

In The Forbes Wireless Stock Watch, he explains, "One of the top companies in this business is San Jose, California-based Altera (NASDAQ: ALTR). Here's his bullish review.

"These PLDs are chips that allow software developers to use inexpensive software tools to quickly develop, simulate, and test their designs. Then, a design can be quickly programmed into the chip and immediately tested in a live circuit.

"Unlike other chips, PLDs are based on re-writable memory technology. That means that if a designer wants to change the design on the chip, the device can be easily reprogrammed.

"Once the design is final, customers can go into immediate production by simply programming as many PLDs as they need with the final software design file. The result is that a final design can be completed much faster and less expensively than that of a custom, fixed logic device.

"While Altera also manufacturers other kinds of chips, it's the PLD business that could really boost the company's business. Eventually, Altera plans to replace the ASIC business entirely with PLDs.

With concerns over recession, turmoil in the financial sector, fear of rising rates, high market volatility and a rising aversion to risk, many investors have been avoiding technology stocks.

Investors have feared that these economic headwinds will dampen both consumer spending for technology products and reduced capital expenditures for technology in the corporate sector.

Despite these concerns, some of the newsletter industry's leading advisors are looking beyond the current malaise and seeing longer-term value in some of the tech sector's leading players. They believe that much of the "bad news" is already reflected in the price of the shares, with little recognition being given to their longer-term potential.

For those willing to go against the crowd and buy, as they say, "while blood is running in the street," we offer a six-pack of technology stocks that the some top advisors considers to be among their favorite ideas.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Altera Corp. (NASDAQ: ALTR) beat Q2 estimates, offered guidance, and announced a quarterly dividend.
• Capital One Financial Corp. (NYSE: COF) profit tumbled as consumers stopped paying off credit cards.
• Coca-Cola Co. (NYSE: KO) mixed Q2 results were boosted by international operations.
• Eaton Corp. (NYSE: ETN) reported strong Q2 numbers but shares still fell afterward.
• Genentech Inc. (NYSE: DNA) did not meet analysts' estimates but lifted its full-year outlook (see transcript).
• Google Inc. (NASDAQ: GOOG) posted strong results that fell short of Wall Street expectations.
• Intel Corp. (NASDAQ: INTC) better-than-expected Q2 results lifted other tech stocks as well (see transcript).
• JPMorgan Chase & Co. (NYSE: JPM) posted better-than-expected Q2 results (see transcript).
• Lawson Software Inc. (NASDAQ: LWSN) net income fell due to an auction-rate securities related charge.
• Mattel Inc. (NYSE: MAT) Q2 results topped expectations despite lower profits on weak demand for Barbie.
• Nokia Corp. (NYSE: NOK) posted better-than-estimated Q2 earnings on strong sales growth.
• Overstock.com Inc. (NASDAQ: OSTK) fell nearly 30% after reporting earnings for the second quarter.
• Rockwell Collins Inc. (NYSE: COL) posted strong Q3 results due to long-term government contracts.
• Sun Microsystems Inc. (NASDAQ: JAVA) preliminary Q1 results sparked an after-market rally.
• Wells Fargo & Co. (NYSE: WFC) beat low earnings expectations and also raised its quarterly dividend.
• Yum! Brands Inc. (NYSE: YUM) beat Q2 expectations due in part to strength overseas, but shares fell.

For more highlights from this week, see: Citigroup, eBay, IBM, Merrill Lynch, Microsoft and others

The earnings crunch continues next week. Among companies scheduled to report are Apple (NASDAQ: AAPL), Bank of America (NYSE: BAC), Merck (NYSE: MRK), Texas Intruments (NYSE: TXN), Caterpillar (NYSE: CAT), Halliburton (NYSE: HAL), United Parcel Service (NYSE: UPS), Wachovia (NYSE: WB), Yahoo! (NASDAQ: YHOO), Amazon (NASDAQ: AMZN), Anheuser-Busch (NYSE: BUD), AT&T Inc. (NYSE: T), McDonald's (NYSE: MCD), PepsiCo (NYSE: PEP), Pfizer (NYSE: PFE), Boeing (NYSE: BA), Hershey (NYSE: HSY), and Southwest Airlines (NYSE: LUV).

Visit AOL Money & Finance for more earnings coverage.

As the second quarter earnings crunch begins in earnest this week, the bear market has investors jittery and prognosticators spinning out dire warnings. In the wake of mixed results from Alcoa (NYSE: AA) and General Electric (NYSE: GE) kicking things off last week, here's a look at what Wall Street is expecting from many of the companies scheduled to report this coming week.

Analysts surveyed by Thomson Financial are expecting the following companies to report a rise in earnings when compared to the same period of the previous year.

• Nucor Corp. (NYSE: NUE): $1.80 EPS (36.6%) on sales of $6.4 billion (+53.0%)
• Google Inc. (NASDAQ: GOOG): $4.74 EPS (24.9%) on sales of $3.9 billion (+41.6%)
• Nokia Corp. (NYSE: NOK): 56 cents EPS (23.2%) on sales of $19.9 billion (+17.8%)
• CSX Corp. (NYSE: CSX): 90 cents EPS (21.1%) on sales of $2.9 billion (+12.8%)
• Altera Corp. (NASDAQ: ALTR): 27 cents EPS (18.5%) on sales of $346.7 million (+8.4%)
• IBM (NYSE: IBM): $1.82 EPS (+17.6%) on sales of $25.9 billion (+9.0%)
• eBay Inc. (NASDAQ: EBAY): 41 cents EPS (17.1%) on sales of $2.2 billion (+18.0%)
• W.W. Grainger Inc. (NYSE: GWW): $1.46 EPS (17.1%) on sales of $1.7 billion (+8.0%)
• Microsoft Corp. (NASDAQ: MSFT): 47 cents EPS (17.0%) on sales of $15.7 billion (+17.0%)
• Honeywell International Inc. (NYSE: HON): 94 cents EPS (17.0%) on sales of $9.2 billion (+7.9%)

We blogged late last fall about semiconductor stocks fundamentals rolling over. It appears semi management is beginning to whisper more and more of moderating results to analysts:

• Lehman cuts Micron Technology Inc's (NYSE: MU) estimates and sees losses for the next three quarters. The increase in demand for memory chips due to Microsoft Corporation's (NASDAQ: MSFT) Vista demanding more memory is not happening.
• Pacific Crest Securities wrote second quarter chip demand is underwhelming, with notebooks and the Nintendo (OTC: NTDOY) Wii the only bright spots.
• J.P. Morgan wrote consensus expectations for both the second quarter and all of 2007 are too high and is trimming estimates, The more significant earnings misses could come from Advanced Micro Devices Inc (NYSE: AMD), Cypress Semiconductor Corporation (NYSE: CY), Intel Corporation (NASDAQ: INTC) and On Semiconductor Corporation (NASDAQ: ONNN); with smaller cuts for Texas Instrments Inc (NYSE: TXN), Broadcom Corporation (NASDAQ: BRCM), Altera Corporation (NASDAQ: ALTR), Xilinx Inc (NASDAQ: XLNX) and Fairchild Semiconductor International (NYSE: FCS).

We began blogging about a slowdown in semiconductor stocks in November. However, most of this slowdown could be coming to an end. It appears from both National Semiconductor Corporation (NYSE: NSM) and Texas Instruments recent earnings releases that both companies are seeing the industry downturn ending as inventories have been worked down and backlog is beginning to build again.

The other major points we have been making is that we are entering the seasonally weak period for these stocks. So be cautious about jumping in with both feet in the early Spring.

Most likely, the two drivers for these stocks is the Fed lowering rates or the typically seasonal pick up which occurs in late summer. Since the Fed is on hold, there appears to be no need to jump into these stocks yet. Let the bad news hit these stocks and then start bottom fishing.

MOST NOTEWORTHY: Today's more notable downgrades included Dell Inc (DELL), Deutsche Telekom ADS (DT) and the Nasdaq Stock Market Inc (NDAQ):

• Needham downgraded Dell inc (NASDAQ: DELL) to Hold from Buy after the Q4 results as they now believe the company is unlikely to outperform for "at least" several quarters. They considered Dell's notebook shipments to be the biggest disappointment in the quarter.

• Deutsche Telecom ADS (NYSE: DT) was cut to Sell from Neutral at Merrill Lynch.

• JP Morgan downgraded the Nasdaq Stock Market Inc (NASDAQ: NDAQ) to Neutral from Overweight following the company's price cuts as they feel the new prices negatively impact the U.S. cash equity business.

OTHER DOWNGRADES:

• Baird cut Xerium Technologies Inc (NYSE: XRM) to Underperform from Neutral, citing increased spending plans and pressure from the underlying paper market that raised dividend sustainability concerns.

• First Albany downgraded Hyperion Solutions Corp (NASDAQ: HYSL) to Neutral from Buy.
  

• Sanders Morris cut Crosstex Energy (NASDAQ: XTEX) to Hold from Buy. Raymond James downgraded shares of Crosstex to Market Perform from Outpeform.

• Bernstein downgraded TXU Corp (NYSE: TXU) to Market Perform from Outperform as the firm believe the current bid from Kohlberg Kravis Roberts and Texas Pacific Group will succeed.

• Merrill Lynch cut Altera Corp (NASDAQ: ALTR) to Neutral from Buy.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Altera Corp (NASDAQ: ALTR) and Chico's FAS (NYSE: CHS) were the most noteworthy companies initiated today.

• Shares of Altera Corp (NASDAQ: ALTR) were initiated with a Buy rating and $26 at Nollenberger; the firm believes that due to the company's faster growth rate, increasing market share and higher gross margins, shares should trade at a premium to Xilinx Inc (NASDAQ: XLNX).

• Soleil Securities initiated shares of Chico's FAS (NYSE: CHS) with a Hold rating, believing it may take at least through the spring season to see a meaningful improvement in operating results.

OTHER INITIATIONS:

• Spirit Aerosystems 'A' (NYSE: SPR) was initiated by several firms: Jefferies with a Buy and $36 target, Credit Suisse with a Neutral and $35 target, Citigroup with a Sell rating and $24 target, Morgan Stanley with an Overweight and $38 target, Cowen with a Neutral rating and UBS with a Neutral and $38 target.

• NYMEX Holdings (NYSE: NMX) was initiated with an Underweight rating at JP Morgan, citing the rich valuation for its rating.

• Shares of Hansen Medical (NASDAQ: HNSN) were initiated with an Overweight rating and a $16 target at Morgan Stanley.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

MOST NOTEWORTHY: Notable companies that were upgraded today included Taiwan Semiconductor (TSM) and the Nasdaq Stock Market (NDAQ).

• Following an inventory correction from 3Q06 to 1Q07, Bear Stearns upgraded Taiwan Semiconductor Manufacturing Company Ltd. (NYSE:TSM) to Outperform from Peer Perform, citing expectations of the semiconductor cycle to accelerate in the second-half of 2007.
• The Nasdaq Stock Market Inc. (NASDAQ:NDAQ)was added to Friedman Billing's Top Pick list, citing an attractive valuation following Friday's sell-off in addition to the company's strategic position.

OTHER UPGRADES:

• Credit Suisse upgraded Vodaphone (NYSE:VOD) to Outperform from Neutral; the firm believes Vodaphone's European mobile division should top expectations in the second quarter.
• Rodman & Renshaw upgraded shares of Gilead Sciences Inc. (NASDAQ:GILD) to Outperform from Market Perform, as they believe the company is poised to benefit from the recent CDC recommendation for routine HIV-testing in all individuals in the U.S. between the ages of 13-64 with a voluntary opt-out policy.
• A.G. Edwards upgraded Altera Corp. (NASDAQ:ALTR) to Buy from Hold following the resolution of the company's stock option issues. Pacific Crest upgraded Altera to Outperform from Sector Perform. They believe Altera is tracking inline with the midpoint of its guidance and that seasonal growth will return in the first quarter.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

Private equity firms are certainly hungry for semiconductor firms, such as the $17.6 billion buyout of Freescale. And recently there was the proposed $5.5 billion deal for Advanced Semiconductor Engineering.

An analyst at Prudential, Mark Lipacis, has put together a buyout list. Basically, he focuses on what private equity firms like -- lots of cash and cash flow.

His picks? Here's a look:

Altera (ALTR)
Analog Devices (ADI)
Linear Technology (LLTC)
Maxim Integrated Products (MXIM)
Texas Instruments (TXN)

Remember, there's a reason that semiconductor companies have lots of cash: the industry is cyclical. If the economy goes south, these companies can wait it out.

And it does look like the economy is slowing down. So if these semiconductor companies take on huge amounts of debt, might they be vulnerable?

Perhaps. But so far, it seems like private equity firms are far from concerned.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates InvestorOffering.com.