Continue to the full article here:
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Showing posts with label semiconductors. Show all posts
Showing posts with label semiconductors. Show all posts
Wednesday, December 19, 2012
Investopedia: A Look Back At The Year In Semiconductors
In what has been a fairly good year for stocks, a few industries stand
out as laggards. Although technology has had a decent 2012, semiconductors
are a notable exception, as the industry is only up about 3 to 6% for
the year (depending upon the data provider). A number of factors have
played in this weak performance. One of the biggest culprits, though,
has been weak demand for computers and consumer electronics. Flagging or
stagnant demand for telecom equipment has also played a major role, as
have slowdowns in the automobile and industrial end-markets. Of course,
the semiconductor industry in not a uniform bloc, and there are many
stories worth further exploration.
Continue to the full article here:
http://www.investopedia.com/
Continue to the full article here:
http://www.investopedia.com/
Friday, October 29, 2010
Divergent Paths For Broadcom and Silicon Labs
Once again, the semiconductor sector offers a remedial lesson that not every company in a sector is inexorably bound to the fate of its brothers. While semiconductor stocks from Linear (Nasdaq:LLTC) to Texas Instruments (NYSE:TXN) to Intel (Nasdaq:INTC) have had their issues with near-term growth outlooks, Broadcom (Nasdaq:BRCM) seems to be rolling on without many worries. In contrast, Silicon Labs (Nasdaq:SLAB) seems mired in a miss-and-lower cycle that is punishing patient shareholders.
The Quarters That Were
Broadcom certainly is not suffering its prime exposure to Apple's (Nasdaq:AAPL) iPhone/iPad, nor its decision to focus on high-performance "combo" chips. Revenue for this third quarter jumped 44% from last year, and 13% sequentially. Better still, the company actually raised its guidance for the next quarter, and is looking for modest sequential growth (where most companies are forecasting sequential declines). Broadcom also benefited by holding reported operating expense growth to 26% - meaning that the company saw significant operating leverage and operating income growth.
Please click the link for the full article:
http://stocks.investopedia.
The Quarters That Were
Broadcom certainly is not suffering its prime exposure to Apple's (Nasdaq:AAPL) iPhone/iPad, nor its decision to focus on high-performance "combo" chips. Revenue for this third quarter jumped 44% from last year, and 13% sequentially. Better still, the company actually raised its guidance for the next quarter, and is looking for modest sequential growth (where most companies are forecasting sequential declines). Broadcom also benefited by holding reported operating expense growth to 26% - meaning that the company saw significant operating leverage and operating income growth.
Please click the link for the full article:
http://stocks.investopedia.
Tuesday, October 12, 2010
KLIC Goes Clunk
The semiconductor space is famous for swinging between euphoria and depression with a cyclical irregularity, and semiconductor equipment is arguably even worse. While analysts have been nervous about chip stocks ranging from Intel (Nasdaq:INTC) to Linear Technology (Nasdaq:LLTC) to Silicon Labs (Nasdaq:SLAB), the warning from small equipment company Kulicke & Soffa (Nasdaq:KLIC) is not going to help matters.
A Mid-Cycle Pause?
Kulicke & Soffa gave investors a classic good news-bad news press release. The good news was that the September quarter was quite strong and revenue is going to be on the high end of guidance. In the "what have you done for me lately?" world of Wall Street, though, the bad news about the December quarter is far more significant. KLIC management said that the December quarter would be "significantly" below the September quarter, and on the basis of past KLIC-speak, that could mean a 20% sequential drop or more.
For the full piece:
http://stocks.investopedia.com/stock-analysis/2010/KLIC-Goes-Clunk-KLIC-AMAT-KLAC-SPIL-ASX1012.aspx
A Mid-Cycle Pause?
Kulicke & Soffa gave investors a classic good news-bad news press release. The good news was that the September quarter was quite strong and revenue is going to be on the high end of guidance. In the "what have you done for me lately?" world of Wall Street, though, the bad news about the December quarter is far more significant. KLIC management said that the December quarter would be "significantly" below the September quarter, and on the basis of past KLIC-speak, that could mean a 20% sequential drop or more.
For the full piece:
http://stocks.investopedia.com/stock-analysis/2010/KLIC-Goes-Clunk-KLIC-AMAT-KLAC-SPIL-ASX1012.aspx
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
Thursday, August 19, 2010
Analog Devices - Will Chips Get Clipped?
Will the real semiconductor market please stand up?
On one side of the hall, analysts are lining up to predict a slowdown (if not decline) for chip companies in the second half of this year. On the other side, companies ranging from Linear Technology (Nasdaq:LLTC) to Texas Instruments (NYSE:TXN) to ON Semiconductor (Nasdaq:ONNN) have reported solid earnings and basically positive guidance.
Given that Analog Devices (NYSE:ADI) is both large and a bit off the regular reporting cycle, perhaps this company's outlook will add a bit of clarity to the situation.
To read the complete piece:
http://stocks.investopedia.
On one side of the hall, analysts are lining up to predict a slowdown (if not decline) for chip companies in the second half of this year. On the other side, companies ranging from Linear Technology (Nasdaq:LLTC) to Texas Instruments (NYSE:TXN) to ON Semiconductor (Nasdaq:ONNN) have reported solid earnings and basically positive guidance.
Given that Analog Devices (NYSE:ADI) is both large and a bit off the regular reporting cycle, perhaps this company's outlook will add a bit of clarity to the situation.
To read the complete piece:
http://stocks.investopedia.
Thursday, July 29, 2010
Silicon Labs Gets A Bit Interesting
I realize that the only way I am ever going to own Silicon Labs (Nasdaq: SLAB) again is if I buy the stock on a sell-off because of growth worries. Well, maybe that is what we have now after the second quarter earnings report and guidance.
SLAB had an okay second quarter; revenue was up 6% sequentially and up 29% from last year's level. Less exciting, though, was the fact that the company's revenue was pretty much in line with the average analyst guess - let's face it, people want "beat and raise" these days. The company saw good strength in microcontrollers, tuners for TVs, and audio chips, but the broadcast business was soft and there was weakness in set-top boxes and voice-over-DSL.
SLAB did do alright on profitability, though. Gross margins ticked up 150bp and the company delivered good EPS growth relative to expectations.
The big problem for SLAB was guidance. The company actually lowered its third quarter guidance to a point below the prior guess. That is tantamount to a cardinal sin these days. Weakness is coming from a sharper fall in FM tuners and bad prospects for the European telecomm sector. All in all, these are not fatal issues and underlying themes like SLAB gaining share in MCUs by integrating peripherals with its MCU core are still intact.
So, when I run a valuation analysis I get a price target of $48.50 - about 18% below today's price. That is not good enough to move me to "buy", but it is pretty close; close enough, certainly for "watch this very carefully". I already own (and still prefer) Microsemi (Nasdaq: MSCC) mostly because the expectations and valuations on MSCC are relatively so soft. I could also get behind taking a look at names like Linear Tech (Nasdaq: LLTC) or Analog Devices (NYSE: ADI) on a relative outperformance/relative value basis.
And not to be left out, ON Semiconductor (Nasdaq: ONNN) is still one of my all-around favorite semiconductor names in general. When I bought MSCC a few months ago, it was a veritable coin flip between MSCC and ONNN.
Back to SLAB ... this is a name that I could see trying to own through a whole semiconductor cycle, even though a lot of people would argue that it is silly to hold a name that you *know* is going to have wild ups and downs. My problem with that is that I have tried to guess the cycles before and I have been wrong (like most analysts have been trying to guess the cycles on a name like Intel (Nasdaq: INTC). Much as it hurts to own a stock during a 20% or 30% pullback, it is arguably even more maddening to sell a stock and see it jump another 25%.
All in all, SLAB is really close to a price that is really interesting. But with so many ideas to choose from, I am not jumping on "close" today.
Disclosure - I own shares of MSCC
SLAB had an okay second quarter; revenue was up 6% sequentially and up 29% from last year's level. Less exciting, though, was the fact that the company's revenue was pretty much in line with the average analyst guess - let's face it, people want "beat and raise" these days. The company saw good strength in microcontrollers, tuners for TVs, and audio chips, but the broadcast business was soft and there was weakness in set-top boxes and voice-over-DSL.
SLAB did do alright on profitability, though. Gross margins ticked up 150bp and the company delivered good EPS growth relative to expectations.
The big problem for SLAB was guidance. The company actually lowered its third quarter guidance to a point below the prior guess. That is tantamount to a cardinal sin these days. Weakness is coming from a sharper fall in FM tuners and bad prospects for the European telecomm sector. All in all, these are not fatal issues and underlying themes like SLAB gaining share in MCUs by integrating peripherals with its MCU core are still intact.
So, when I run a valuation analysis I get a price target of $48.50 - about 18% below today's price. That is not good enough to move me to "buy", but it is pretty close; close enough, certainly for "watch this very carefully". I already own (and still prefer) Microsemi (Nasdaq: MSCC) mostly because the expectations and valuations on MSCC are relatively so soft. I could also get behind taking a look at names like Linear Tech (Nasdaq: LLTC) or Analog Devices (NYSE: ADI) on a relative outperformance/relative value basis.
And not to be left out, ON Semiconductor (Nasdaq: ONNN) is still one of my all-around favorite semiconductor names in general. When I bought MSCC a few months ago, it was a veritable coin flip between MSCC and ONNN.
Back to SLAB ... this is a name that I could see trying to own through a whole semiconductor cycle, even though a lot of people would argue that it is silly to hold a name that you *know* is going to have wild ups and downs. My problem with that is that I have tried to guess the cycles before and I have been wrong (like most analysts have been trying to guess the cycles on a name like Intel (Nasdaq: INTC). Much as it hurts to own a stock during a 20% or 30% pullback, it is arguably even more maddening to sell a stock and see it jump another 25%.
All in all, SLAB is really close to a price that is really interesting. But with so many ideas to choose from, I am not jumping on "close" today.
Disclosure - I own shares of MSCC
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
Friday, April 30, 2010
Silicon Labs - Quality Doesn't Come Cheap
The following went up on Investopedia this morning.
Enjoy!
http://stocks.investopedia.com/stock-analysis/2010/Silicon-Labs---Quality-Doesnt-Come-Cheap-SLAB-CSCO-AAPL-ADI-BRCM0430.aspx
The semiconductor business is not for the faint of heart. Lucky for Silicon Labs (Nasdaq: SLAB) shareholders, then, that they have a rather bold and skilled management team. Remember, this is a company that decided about three years ago to sell a profitable wireless business that was about one-third of the company's revenue because management foresaw increasing competition and decreasing profitability. Since that gutsy move, the company has almost completely replaced that revenue despite the recession.
A Very Strong Quarter In The BooksSilicon Labs reported earnings April 28 that should leave its shareholders satisfied. Revenue rose 51%, while gross margins jumped almost 6%. With significantly higher gross profits, the company was better able to leverage its overhead more effectively even while reporting higher R&D and SG&A expenses. Operating income, then, was significantly higher than in the year-ago period, and the company handily beat estimates.
The rest at: http://stocks.investopedia.com/stock-analysis/2010/Silicon-Labs---Quality-Doesnt-Come-Cheap-SLAB-CSCO-AAPL-ADI-BRCM0430.aspx
Enjoy!
http://stocks.investopedia.com/stock-analysis/2010/Silicon-Labs---Quality-Doesnt-Come-Cheap-SLAB-CSCO-AAPL-ADI-BRCM0430.aspx
The semiconductor business is not for the faint of heart. Lucky for Silicon Labs (Nasdaq: SLAB) shareholders, then, that they have a rather bold and skilled management team. Remember, this is a company that decided about three years ago to sell a profitable wireless business that was about one-third of the company's revenue because management foresaw increasing competition and decreasing profitability. Since that gutsy move, the company has almost completely replaced that revenue despite the recession.
A Very Strong Quarter In The BooksSilicon Labs reported earnings April 28 that should leave its shareholders satisfied. Revenue rose 51%, while gross margins jumped almost 6%. With significantly higher gross profits, the company was better able to leverage its overhead more effectively even while reporting higher R&D and SG&A expenses. Operating income, then, was significantly higher than in the year-ago period, and the company handily beat estimates.
The rest at: http://stocks.investopedia.com/stock-analysis/2010/Silicon-Labs---Quality-Doesnt-Come-Cheap-SLAB-CSCO-AAPL-ADI-BRCM0430.aspx
Monday, October 20, 2008
Linear Throws A Curve (LLTC, MXIM, NSM)
http://community.investopedia.com/news/IA/2008/Linear-Throws-A-Curve-LLTC-MXIM-NSM1020.aspx
Since I wrote this, we've now seen Texas Instrument's guidance. Not good.
Looks like LLTC mgmt had this one right...
Since I wrote this, we've now seen Texas Instrument's guidance. Not good.
Looks like LLTC mgmt had this one right...
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