Tech investors love growth, and with many semiconductor stocks grinding through a rut, Inphi’s (IPHI) strong double-digit growth is definitely bringing the stock plenty of the right kind of attention. Customers like Amazon (AMZN), Google (GOOGL) (NASDAQ:GOOG), and Microsoft (MSFT)
continue to invest heavily into high-end data center capacity, driving
strong demand for Inphi’s high-performance optical components, and the Cisco (CSCO)–Acacia (ACIA) deal could shift more DSP business toward Inphi as Acacia customers reconsider their supply chains.
I love Inphi’s business, but the stock is a little harder for me to embrace now. I thought the shares had upside back in May
on the back of that above-average growth potential, but the 25% move
was more than I expected. I know growth stocks can live in their own
world when it comes to valuation (for a little while, at least), and I’m
not betting against Inphi, but the Street already seems to be counting
on a significant ramp in data center spending in 2020 and beyond.
Read more here:
High-End Data Center Opportunities Driving Inphi
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