Needham & Company on Analog/Mixed Signal: Q4 Earnings Preview: Don't Expect a Linear Correlation this Earnings Season
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Rating Summary:
1 Buy, 16 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 6 | Down: 3 | New: 2
Rating Summary:
1 Buy, 16 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 6 | Down: 3 | New: 2
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Needham & Company on Analog/Mixed Signal: Q4 Earnings Preview: Don't Expect a Linear Correlation this Earnings Season
Analyst, Vernon Essi, Jr, said, "This week our Analog/Mixed Signal universe of stocks, along with the entire semiconductor sector, had a white hot "melt-up" off of the favorable news primarily out of Linear Technology (Nasdaq: LLTC) (NR) Wednesday along with Xilinx (Nasdaq: XLNX) (NR) later after the close. While the management of Linear did not provide perfect clarity on whether demand is primarily being driven by inventory restocking (i.e. customers taking on inventory after having such lean levels after the last couple of quarters) or a resumption in end market demand sell-through, there was an indication that the revenue guide of 4-8% revenue growth Q/Q assumed no channel restocking..."
"With regards to 2012 we do see a channel refresh towards the close of Q1 and believe this is fully baked into the group. Industrial is due for a restocking of inventory and we expect the companies with a high concentration of Industrial revenue mix are likely to benefit. We highlight Cirrus Logic (Nasdaq: CRUS) with roughly 25% of its revenue sold into "Energy" (mostly Industrial customers) and is cleared through distributors, Maxim (Nasdaq: MXIM) with about 28% of its revenue exposed to Industrial and finally Silicon Labs (Nasdaq: SLAB) with ~40% exposure to "Broad-Based" which would benefit from a channel restocking scenario. We note that Texas Instruments, now combined with National Instruments, has roughly a 25% exposure to Industrial within its Analog revenue; this however will be offset by Computing which represents between 25% and 30% of revenue by our estimate."
"We continue to highlight secular growth themes: Cirrus Logic, which is participating in Apple's product roadmap, and Volterra (Nasdaq: VLTR), despite its rich valuation has a high attach rate to blade server growth and general cloud infrastructure are two of our favorite picks. We also like Maxim for its larger-cap product breadth, financial performance and likely
market share gains over the last couple of years due to its handset exposure."
Heading into the Q4 earnings season we highlight three names to own: Cirrus Logic, Maxim and Volterra.
Heading into the Q4 earnings season we highlight two names to trim: Texas Instruments (NYSE: TXN) and ON Semi (Nasdaq: ONNN), both downgraded to Hold from Buy.
Analyst, Vernon Essi, Jr, said, "This week our Analog/Mixed Signal universe of stocks, along with the entire semiconductor sector, had a white hot "melt-up" off of the favorable news primarily out of Linear Technology (Nasdaq: LLTC) (NR) Wednesday along with Xilinx (Nasdaq: XLNX) (NR) later after the close. While the management of Linear did not provide perfect clarity on whether demand is primarily being driven by inventory restocking (i.e. customers taking on inventory after having such lean levels after the last couple of quarters) or a resumption in end market demand sell-through, there was an indication that the revenue guide of 4-8% revenue growth Q/Q assumed no channel restocking..."
"With regards to 2012 we do see a channel refresh towards the close of Q1 and believe this is fully baked into the group. Industrial is due for a restocking of inventory and we expect the companies with a high concentration of Industrial revenue mix are likely to benefit. We highlight Cirrus Logic (Nasdaq: CRUS) with roughly 25% of its revenue sold into "Energy" (mostly Industrial customers) and is cleared through distributors, Maxim (Nasdaq: MXIM) with about 28% of its revenue exposed to Industrial and finally Silicon Labs (Nasdaq: SLAB) with ~40% exposure to "Broad-Based" which would benefit from a channel restocking scenario. We note that Texas Instruments, now combined with National Instruments, has roughly a 25% exposure to Industrial within its Analog revenue; this however will be offset by Computing which represents between 25% and 30% of revenue by our estimate."
"We continue to highlight secular growth themes: Cirrus Logic, which is participating in Apple's product roadmap, and Volterra (Nasdaq: VLTR), despite its rich valuation has a high attach rate to blade server growth and general cloud infrastructure are two of our favorite picks. We also like Maxim for its larger-cap product breadth, financial performance and likely
market share gains over the last couple of years due to its handset exposure."
Heading into the Q4 earnings season we highlight three names to own: Cirrus Logic, Maxim and Volterra.
Heading into the Q4 earnings season we highlight two names to trim: Texas Instruments (NYSE: TXN) and ON Semi (Nasdaq: ONNN), both downgraded to Hold from Buy.
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