In the rock-paper-scissors world of the stock market, apparently an auto market recovery trumps a major acquisition and an earthquake, as Renesas Electronics (OTCPK:RNECY) (6723.T) shares have appreciated around 80% since my last update on the company, handily outperforming the SOX index over that time, as well as other auto-driven semiconductor companies like Infineon (OTCQX:IFNNY), NXP Semiconductors (NXPI), and STMicro (STM), though ON Semiconductor (ON) has basically kept pace.
I liked the bid for Dialog Semiconductor (OTCPK:DLGNF), particularly as the company seems to be deprioritizing the Apple (AAPL) aspects of that business and is focused instead on taking Dialog’s core technologies in power management, connectivity, and advanced mixed signal chips and reapplying them to end-markets like autos, industrial, and IoTs.
Renesas shares have had a good rally, but they don’t yet look overvalued (or even fairly-valued) to me yet. While I can understand uncertainties about the benefits of the Dialog deal, I believe Renesas may also be lagging because it doesn’t tell quite as exciting of a story where autos and xEVs are concerned. While it’s true that Renesas doesn’t have the leverage to electrification of Infineon, STMicro, or ON, I wouldn’t ignore the long-term opportunities in areas like ADAS, nor non-auto opportunities like IoT.
Read more here:
Renesas Electronics Positively Leveraged To Stronger Autos And New End-Market Opportunities
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