Needham & Company Upgrades Silicon Labs (SLAB) to Buy

March 5, 2020 6:48 AM EST
Get Alerts SLAB Hot Sheet
Price: $141.05 -0.92%

Rating Summary:
    14 Buy, 14 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 10 | Down: 9 | New: 61
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Needham & Company analyst Rajvindra Gill upgraded Silicon Labs (NASDAQ: SLAB) from Hold to Buy with a price target of $115.00.

The analyst commented, "We are upgrading SLAB to a Buy from a Hold and establishing a $115 PT. The stock has fallen 24% YTD vs. -8% for the SOX. Shares are now trading at 26.7x our 2020 EPS estimate, a 23% discount to its peak P/E multiple. While COVID-19 will remain an overhang, we think we are approaching a bottom in the shares. We had been looking for an attractive entry point; we believe at these levels, we found it. Based on recent commentary from MCHP and NXPI, customer orders in China are rebounding as manufacturing plants come online, and there could be a sizable snapback in June. Moreover, we find SLAB's positioning in IoT compelling, specifically around wireless IoT (2/3 of IoT). We also expect its 3/12 Analyst Day will serve as a catalyst for the shares with possible updates to gross and operating margin targets along with revenue growth projections."

For an analyst ratings summary and ratings history on Silicon Labs click here. For more ratings news on Silicon Labs click here.

Shares of Silicon Labs closed at $92.06 yesterday.

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