Six months ago, I thought the Street had overreacted to disappointing results at Maxim Integrated Products (NASDAQ:MXIM)
to such an extent that the stock looked like a good relative value in
the space. Since then, the shares have done pretty well relative to its
peer group - up about 15% while Linear (NASDAQ:LLTC) and Analog Devices (NASDAQ:ADI) were up in the single-digits and a stock I liked better, ON Semiconductor (NASDAQ:ONNN) rose about 16%.
Maxim is still facing the same basic set of challenges - finding new sources of growth now that Samsung
is no longer likely to be a significant growth driver in the coming
years. Maxim is saying and doing some of the right things, including
getting out of low-margin businesses like consumer MEMS and touch and
focusing on higher-growth opportunities in industrial and auto, but I'm
concerned about the company's ability to truly differentiate itself.
With the valuation looking pretty fair today, I don't dislike the stock
but can't work up a lot of excitement to buy in today.
Follow this link for more:
Without A Bigger Discount, Maxim Not So Interesting Today
No comments:
Post a Comment