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Showing posts with label Marvel. Show all posts
Showing posts with label Marvel. Show all posts
Monday, May 7, 2012
Investopedia: Broadcom's Quality Limits The Bargain
Investors canvassing the chip sector for ideas today have to make a tough choice - go with quality names like Broadcom (Nasdaq:BRCM) and Qualcomm (Nasdaq:QCOM) and pay premiums that may limit capital gains, or go with cheaper names like Silicon Labs (Nasdaq:SLAB)
that have more questions and yellow flags. Broadcom remains a quality
play on the mobile explosion (and combo chips in general), and still
looks like a reasonable candidate for investors looking to add tech to
their portfolio.
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Thursday, February 9, 2012
Investopedia: PMC-Sierra May Have More Growth In Store
It probably sounds like a double-whammy to consider a stock that is exposed to both the semiconductor cycle and the enterprise/carrier spending cycle as well. For better or worse, that's the situation for PMC-Sierra (Nasdaq:PMCS) as the veteran semiconductor company continues to leverage itself to emerging growth opportunities in storage and cloud computing while balancing out its legacy businesses in optical networking and wireless infrastructure.
Another Chip Company with Tough Q4 Numbers
It's not exactly challenging to find semiconductor companies that had some weak spots in their December quarter reports. Consequently, PMCS is not exactly in rare company with a quarterly report that was just a little light.
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Monday, February 6, 2012
Investopedia: Qualcomm's Growth Story Far From Over
Having already built up a thumping market share in mobile baseband chips, maybe some think that Qualcomm's (Nasdaq:QCOM) growth prospects have to be shrinking as the law of large numbers takes hold. That looks like a hasty (not to mention wrong) analysis - not only is Qualcomm continuing to leverage its current market strength, but the company is looking to expand into new markets that should add billions to its addressable market opportunity.
A Strong Start to the Fiscal Year
Qualcomm reported that sales rose nearly 40% this quarter (and nearly 14% relative to the fiscal fourth quarter), beating the average analyst guess by more than $100 million. Both of the core businesses were strong - licensing saw revenue rise more than 36%, while the chip business had a gaudy 46% topline growth. MSM chip shipment rose 23% from the fourth quarter, and while the number of royalty-earning devices was a little shy of expectation, the average selling prices (ASP) have been stronger than forecasted.
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A Strong Start to the Fiscal Year
Qualcomm reported that sales rose nearly 40% this quarter (and nearly 14% relative to the fiscal fourth quarter), beating the average analyst guess by more than $100 million. Both of the core businesses were strong - licensing saw revenue rise more than 36%, while the chip business had a gaudy 46% topline growth. MSM chip shipment rose 23% from the fourth quarter, and while the number of royalty-earning devices was a little shy of expectation, the average selling prices (ASP) have been stronger than forecasted.
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Tuesday, January 17, 2012
Investopedia: Can Fusion-IO Outrun The Tiger?
There is a saying that goes, "you don't have to be faster than the tiger, you just have to be faster than your slowest friend." That may be a constructive way of thinking about Fusion-IO (NYSE:FIO) today. There's no question that this is a high-growth tech stock with a huge multiple and huge expectations, but that has never stopped those tech stocks that can deliver the goods. (For more, see Earning Forecasts: A Primer.)
Big Data 2.0
In some respects, what Fusion-IO seeks to do is relatively simple. In the same way that solid-state drives (SSD) have offered consumers considerably better performance than hard disk drives, Fusion-IO is trying to bring the advantages of flash/SSD memory to the enterprise data market.
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Big Data 2.0
In some respects, what Fusion-IO seeks to do is relatively simple. In the same way that solid-state drives (SSD) have offered consumers considerably better performance than hard disk drives, Fusion-IO is trying to bring the advantages of flash/SSD memory to the enterprise data market.
Please click here for more:
http://stocks.investopedia.
Monday, March 28, 2011
Investopedia: Is RIM Turning Into Nokia 2.0?
If Apple (Nasdaq:AAPL) is the smartphone company that can do no wrong, then Research In Motion (Nasdaq:RIMM) is the company that cannot seem to deliver what the Street wants. Now, with the company giving very iffy guidance for its next fiscal year and seemingly losing momentum at the high end of the range, the fear is that the company may be slipping past a point of no return.
An Uninspiring End to the YearThe absolute details of RIM's quarter were not bad, but near-term stock market performance is almost always a game of performance relative to expectations. RIM did post 36% revenue growth, with device sales making up about 81% of the total. This top-line result did miss estimates, though. Below the top line, results were okay, but not exciting. Gross margin weakened from the year-ago level, dropping about 150 basis points. Likewise, operating income rose more than 22%, but margin contracted two and a half full points.
A Very Tough Year on the Way
Although RIM made the claim that the BlackBerry was the best smartphone in the U.S. in 2010, that is the sort of press release filler that makes absolutely no difference in the assessment of the stock. What matters far more is the fact that there will apparently be no new models in the first quarter, and that there were will likely be a lot of inventory-clearing in the front half of the year. That means that margins are going to take a hit, expectations will be back-end-loaded into the second half, and analysts and investors will have plenty of doubts about management's view of the company's earnings power.
Although management did confirm that the new Playbook will support apps that run on Google's (Nasdaq:GOOG) Android, that was about it for the good news.
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An Uninspiring End to the YearThe absolute details of RIM's quarter were not bad, but near-term stock market performance is almost always a game of performance relative to expectations. RIM did post 36% revenue growth, with device sales making up about 81% of the total. This top-line result did miss estimates, though. Below the top line, results were okay, but not exciting. Gross margin weakened from the year-ago level, dropping about 150 basis points. Likewise, operating income rose more than 22%, but margin contracted two and a half full points.
A Very Tough Year on the Way
Although RIM made the claim that the BlackBerry was the best smartphone in the U.S. in 2010, that is the sort of press release filler that makes absolutely no difference in the assessment of the stock. What matters far more is the fact that there will apparently be no new models in the first quarter, and that there were will likely be a lot of inventory-clearing in the front half of the year. That means that margins are going to take a hit, expectations will be back-end-loaded into the second half, and analysts and investors will have plenty of doubts about management's view of the company's earnings power.
Although management did confirm that the new Playbook will support apps that run on Google's (Nasdaq:GOOG) Android, that was about it for the good news.
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Friday, January 21, 2011
Investopedia: Double Trouble For Seagate Technology
Even in the best of times, the disk drive business has been fiercely competitive and prone to brutal cyclicality. While Seagate (NYSE:STX) has survived long enough to be a leading player in disk drives, the company's future is still under assault. In the short-term, there are ample worries about whether the PC market will have a decent 2011 and survive the inroads made by alternatives like tablets and phones from Apple (Nasdaq:AAPL), Dell (Nasdaq:DELL), Samsung and Research In Motion (Nasdaq:RIMM). Longer term, there is the question of whether conversion to solid state drives will supplant the core of Seagate's business entirely.
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The Quarter That WasFor the here and now, Seagate is posting mediocre performance. The company's fiscal second quarter met consensus and was in line with a prior preannouncement. What's more, this cyclical malaise really did not surprise anybody all that much.
Consequently, there is not so much concern that revenue rose 1% sequentially, but fell 10% from last year's level. Gross margin was a bit more of a concern, though, as the performance was relatively feeble (gross margin declined 1,100 basis points from last year's level). Likewise, operating income was weak, falling by 64% on a year-over-year basis.
All in all, Seagate's performance was hurt not only by a general slowdown in PCs, but a decision not to compete on price in certain markets. As a result, unit volume declined and the company had less operating efficiency. One small bright spot was the company's non-computer business, where there was some volume strength in drives for applications like DVRs and gaming consoles.
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Monday, December 20, 2010
Is RIMM Losing The War?
Research In Motion (Nasdaq:RIMM) would not be the first company to largely invent a market, only to see latecomers take the business away from them. Although it is absolutely fair to debate whether RIMM's Blackberry "invented" the market that Apple (Nasdaq:AAPL), Google (Nasdaq:GOOG) and Motorola (NYSE:MOT) are profitably exploiting now, the more relevant question is whether RIMM can withstand the battles in the market and remain a top competitor. After all, Nokia (NYSE:NOK) was seen as a leader once, too.
A Bright Quarter With A Dark Shadow
In many respects RIMM delivered a fine quarter. Revenue rose 40% from last year (and 19% sequentially) to almost $5.5 billion, with handset revenue and shipments increasing by similar degrees. Given that RIMM surpassed the average estimate and was close to the high end of the range, that would normally be good news. On the other hand, U.S. revenue dropped 16% sequentially despite an aggressive promotion of Torch at AT&T (NYSE:T) and channel inventory ticked up - while either of these events on their own may be no problem, the combination is a valid reason for concern.
Nevertheless, profitability at RIMM is still good. Gross margin improved almost a full point from last year (though declined more than that sequentially), and operating margin was modestly better. All in all, operating income rose 42% from last year (and 16% from last quarter), while net profits rose 45%. RIMM also did well from a cash perspective, adding about $450 million in cash to the balance sheet.
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A Bright Quarter With A Dark Shadow
In many respects RIMM delivered a fine quarter. Revenue rose 40% from last year (and 19% sequentially) to almost $5.5 billion, with handset revenue and shipments increasing by similar degrees. Given that RIMM surpassed the average estimate and was close to the high end of the range, that would normally be good news. On the other hand, U.S. revenue dropped 16% sequentially despite an aggressive promotion of Torch at AT&T (NYSE:T) and channel inventory ticked up - while either of these events on their own may be no problem, the combination is a valid reason for concern.
Nevertheless, profitability at RIMM is still good. Gross margin improved almost a full point from last year (though declined more than that sequentially), and operating margin was modestly better. All in all, operating income rose 42% from last year (and 16% from last quarter), while net profits rose 45%. RIMM also did well from a cash perspective, adding about $450 million in cash to the balance sheet.
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Thursday, December 2, 2010
Seagate Decides To Stay Public
With mergers going off left and right in the tech space, particularly in the storage area, it is a bit of a switch to hear about a deal that does not happen. But that is the case for disk drive maker Seagate Technology (NYSE:STX), which announced after the close on Monday that the board had decided to end discussions of selling the company to private equity investors.
Where was the Bar?
Although the company had publicly acknowledged some indications of interest in taking the country private back in October, the recent rumors were that potential deals were falling apart as private equity groups balked at the price. There has been no public discussion of what Seagate believed was a "fair price", but it would not be surprising if $20 was the starting point that the board had in mind. After all, even though companies like 3Par ,being acquired by Hewlett-Packard (NYSE:HPQ), and Isilon Systems (Nasdaq:ISLN), being acquired by EMC (NYSE:EMC), are very different than Seagate, there might nevertheless have been an element of "storage is storage" mentality and an expectation from the board of a solid premium.
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Where was the Bar?
Although the company had publicly acknowledged some indications of interest in taking the country private back in October, the recent rumors were that potential deals were falling apart as private equity groups balked at the price. There has been no public discussion of what Seagate believed was a "fair price", but it would not be surprising if $20 was the starting point that the board had in mind. After all, even though companies like 3Par ,being acquired by Hewlett-Packard (NYSE:HPQ), and Isilon Systems (Nasdaq:ISLN), being acquired by EMC (NYSE:EMC), are very different than Seagate, there might nevertheless have been an element of "storage is storage" mentality and an expectation from the board of a solid premium.
Please click below for the full piece:
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Tuesday, November 23, 2010
Black Christmas For PC Chips?
It is good practice for investors to cast their information nets as wide as possible to monitor their holdings and make better investment decisions. To that point, although Dell (Nasdaq: DELL) did not have a bad recent quarter, some semiconductor investors may not be so happy with some of the details. Reading tea leaves like this is hardly a perfect science, but there were a few scattered details that could become a problem.
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PC, Or Not PC?
In many respects, Dell had a solid quarter. Margins were particularly strong and the company produced solid operating leverage. Looking through to what drives chip demand, though, the picture gets a little bit murky. Overall, desktop sales rose 21% annually but fell 6% sequentially and notebook ("mobility") sales were up 16% and 3% for those same respective periods. Moreover, stripping ASP growth out of the equation makes the unit growth a little more concerning.
On top of all that, management's comment that the "refresh cycle is in full bloom" is a little odd, given that sequential guidance for the fourth quarter was not that great. Again, this is not about Dell's performance - the issue is whether or not there is still solid PC and notebook demand sufficient to power the chip stocks that supply the market. (For more, see 4 Cheap, High-Quality Stocks.)
In many respects, Dell had a solid quarter. Margins were particularly strong and the company produced solid operating leverage. Looking through to what drives chip demand, though, the picture gets a little bit murky. Overall, desktop sales rose 21% annually but fell 6% sequentially and notebook ("mobility") sales were up 16% and 3% for those same respective periods. Moreover, stripping ASP growth out of the equation makes the unit growth a little more concerning.
On top of all that, management's comment that the "refresh cycle is in full bloom" is a little odd, given that sequential guidance for the fourth quarter was not that great. Again, this is not about Dell's performance - the issue is whether or not there is still solid PC and notebook demand sufficient to power the chip stocks that supply the market. (For more, see 4 Cheap, High-Quality Stocks.)
Please click the link for the full piece:
http://stocks.investopedia.
Friday, August 27, 2010
And Here We Go ... Intel Lowers Guidance
When I saw the news that Intel's (Nasdaq: INTC) stock was halted, my first thought was that we were going to see news that Intel had closed the deal to buy Infineon's (Nasdaq: IFNNY) wireless chip business.
Nope.
Instead, Intel announced a pretty sizable revision to its third quarter guidance. Sighting weak PC sales and inventory issues, Intel cut its revenue guidance by $200 million to $1 billion. Keep in mind, this is about six weeks after the company reported earnings, so things must be getting ugly pretty quickly.
In a nutshell, analysts' worries about the semiconductor space seem to be coming true. This should definitely be a concern for Advanced Micro Devices (NYSE: AMD) and Nvidia (Nasdaq: NVDA) given their reliance on the same PC market as Intel.
A bigger question for me, though, is whether this spreads out into other consumer electronics like smartphones/cell phones, PDAs, and so on. That could suck in Maxim (Nasdaq: MXIM), Broadcom (Nasdaq: BRCM), Atheros (Nasdaq: ATHR), Silicon Labs (Nasdaq: SLAB), Qualcomm (Nasdaq: QCOM) and Marvel (Nasdaq: MRVL), as they all have exposure to various consumer-oriented devices like phones, computers, gaming systems, and so on.
On the other hand, names like Texas Instruments (NYSE: TXN), Linear Technology (Nasdaq: LLTC), Analog Devices (NYSE: ADI), ON Semiconductor (Nasdaq: ONNN), and Microsemi (Nasdaq: MSCC) should all be diversified enough that a decline in consumer electronics would not hurt them too badly. Of course, if this decline in consumer devices is simply a part of a much broader overall economic slowdown, all bets are off. After all, nobody is too optimistic about conditions in industrial markets, enterprise hardware and IT, automobiles, or healthcare right now.
Now here is the twist - it would not shock me if this news has minimal impact on the sector. After all, analysts have been racing each other to the bottom; everybody trying to get out their own pessimistic story about the next few months of chip sales. So, this could ultimately strike investors as a revision that was not really so bad as feared. Looking at valuations in the sector, it is pretty clear that there was a fair bit of pessimism anyway, so a little bad news may not change things all that much.
What should investors do? Stick with the stocks that they already liked. I have been positive on names like Microsemi, ON, Analog Devices, and Linear before, so I see no real reason to change now. I am even a little positive on Intel as well - I hope they do not overpay for Infineon (assuming they go ahead with the wireless deal as is commonly rumored), but there is probably some long-term value there.
Disclosure - I own shares of Microsemi
Nope.
Instead, Intel announced a pretty sizable revision to its third quarter guidance. Sighting weak PC sales and inventory issues, Intel cut its revenue guidance by $200 million to $1 billion. Keep in mind, this is about six weeks after the company reported earnings, so things must be getting ugly pretty quickly.
In a nutshell, analysts' worries about the semiconductor space seem to be coming true. This should definitely be a concern for Advanced Micro Devices (NYSE: AMD) and Nvidia (Nasdaq: NVDA) given their reliance on the same PC market as Intel.
A bigger question for me, though, is whether this spreads out into other consumer electronics like smartphones/cell phones, PDAs, and so on. That could suck in Maxim (Nasdaq: MXIM), Broadcom (Nasdaq: BRCM), Atheros (Nasdaq: ATHR), Silicon Labs (Nasdaq: SLAB), Qualcomm (Nasdaq: QCOM) and Marvel (Nasdaq: MRVL), as they all have exposure to various consumer-oriented devices like phones, computers, gaming systems, and so on.
On the other hand, names like Texas Instruments (NYSE: TXN), Linear Technology (Nasdaq: LLTC), Analog Devices (NYSE: ADI), ON Semiconductor (Nasdaq: ONNN), and Microsemi (Nasdaq: MSCC) should all be diversified enough that a decline in consumer electronics would not hurt them too badly. Of course, if this decline in consumer devices is simply a part of a much broader overall economic slowdown, all bets are off. After all, nobody is too optimistic about conditions in industrial markets, enterprise hardware and IT, automobiles, or healthcare right now.
Now here is the twist - it would not shock me if this news has minimal impact on the sector. After all, analysts have been racing each other to the bottom; everybody trying to get out their own pessimistic story about the next few months of chip sales. So, this could ultimately strike investors as a revision that was not really so bad as feared. Looking at valuations in the sector, it is pretty clear that there was a fair bit of pessimism anyway, so a little bad news may not change things all that much.
What should investors do? Stick with the stocks that they already liked. I have been positive on names like Microsemi, ON, Analog Devices, and Linear before, so I see no real reason to change now. I am even a little positive on Intel as well - I hope they do not overpay for Infineon (assuming they go ahead with the wireless deal as is commonly rumored), but there is probably some long-term value there.
Disclosure - I own shares of Microsemi
Wednesday, July 21, 2010
Linear Technology - Rodney Dangerfield In Semiconductor Form
I used to own Linear Technology (Nasdaq: LLTC) and today is sort of a microcosm as to why I eventually sold at a small profit (much smaller than it should have been) - the company just cannot catch a break.
Revenue was up 18% sequentially due in part to strong "iX" demand at Apple (Nasdaq: AAPL), as LLTC provides AAPL with battery charge chips and DC converters for the iPhone and iPad. Gross margins climbed 50bp to 78.4%, operating margins also rose, and operating profits jumped almost 26% sequentially. On top of all that, the company raised its guidance for the back half of the year.
And yet, the stock is still down.
Linear has always been hounded over the "certainty" that their high margins will eventually dissolve under competition. Never mind the fact that they are an innovative leader in the high-performance analog market, have a small army of researchers, and almost always manage to stay ahead of the game. Never mind the fact that Linear has always been smart about balancing the trade-offs of growth and profitability. Nope, apparently less innovative growth-at-any-cost companies are going to beat them.
I mean, honestly, it gets a little depressing. Even Craig Berger, an analyst I respect a lot at FBR, has them at an Underperform ... even while praising them as an exceptionally well-run company.
Okay, I get that Linear's plays in markets that can be low-growth *and* volatile (autos, industrial). But c'mon ... they sell 7,000 products to 15,000+ customers and they were good enough to earn the blessing of St. Steven of Jobs.
Oh well, I should practice what I preach I suppose. I mean, I do not own LLTC anymore and my only semi holding is Microsemi (Nasdaq: MSCC), though I would happily add ON Semi (Nasdaq: ONNN) as well. I can also relate to people who would rather own Analog Devices (NYSE: ADI) or Marvel (Nasdaq: MRVL). But even still ... LLTC feels like a company and a stock that struggles to get its due.
Disclosure - I own shares of Microsemi
Revenue was up 18% sequentially due in part to strong "iX" demand at Apple (Nasdaq: AAPL), as LLTC provides AAPL with battery charge chips and DC converters for the iPhone and iPad. Gross margins climbed 50bp to 78.4%, operating margins also rose, and operating profits jumped almost 26% sequentially. On top of all that, the company raised its guidance for the back half of the year.
And yet, the stock is still down.
Linear has always been hounded over the "certainty" that their high margins will eventually dissolve under competition. Never mind the fact that they are an innovative leader in the high-performance analog market, have a small army of researchers, and almost always manage to stay ahead of the game. Never mind the fact that Linear has always been smart about balancing the trade-offs of growth and profitability. Nope, apparently less innovative growth-at-any-cost companies are going to beat them.
I mean, honestly, it gets a little depressing. Even Craig Berger, an analyst I respect a lot at FBR, has them at an Underperform ... even while praising them as an exceptionally well-run company.
Okay, I get that Linear's plays in markets that can be low-growth *and* volatile (autos, industrial). But c'mon ... they sell 7,000 products to 15,000+ customers and they were good enough to earn the blessing of St. Steven of Jobs.
Oh well, I should practice what I preach I suppose. I mean, I do not own LLTC anymore and my only semi holding is Microsemi (Nasdaq: MSCC), though I would happily add ON Semi (Nasdaq: ONNN) as well. I can also relate to people who would rather own Analog Devices (NYSE: ADI) or Marvel (Nasdaq: MRVL). But even still ... LLTC feels like a company and a stock that struggles to get its due.
Disclosure - I own shares of Microsemi
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