Mizuho Recommends Buying AVGO, ON, CY and MU on Trade Truce
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Mizuho semiconductor analyst Vijay Rakesh said they are buyers of Broadcom (NASDAQ: AVGO), ON Semiconductor (NASDAQ: ON), Cypress Semiconductor (NASDAQ: CY) and Micron Technology (NASDAQ: MU) on the U.S./China trade truce.
Rakesh commented, "The initial commentary coming out of Presidents Trump-Xi meeting at the G-20 on Saturday points to a temporary reprieve as the feared 25% tariffs are now delayed for 90-days as talks for a trade deal continue. A push-out of the tariff deadline should improve 1Q19 visibility and orders for semis suppliers, including also with potential pull-ins of orders ahead of another tariff deadline overhang potentially Mar-31. As we had noted earlier, with the semi group down 25-35% from their peaks (Link), a lot of the uncertainty was reflected in the stocks but the additional removal or pushout of the overhang could point to a relief rally. We are buyers of AVGO, ON, CY, and MU, which have all been disproportionately hit with tariff concerns and worries of limited 1Q19 visibility. We believe these should resolve N-T."
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