Best of the Week
Most Popular
1.Crude Oil Price Trend Forecast 2016 Implications for Stock Market - Nadeem_Walayat
2.Odds of Winning Walkers Crisps Spell & Go olidays K, C and D Letters - Sami_Walayat
3.Massive Silver Price Rally During The Coming US Dollar Collapse - Hubert_Moolman
4.Pope Francis Calls For Worldwide Communist Government - Jeff_Berwick
5.EU Referendum Opinion Polls Neck and Neck Despite Operation Fear, Support BrExit Campaign - Nadeem_Walayat
6.David Morgan: There Will Soon Be a Run to Gold Like You've Never Seen Before - Mike Gleason
7.British Pound Soars on BrExit Hopes Despite Remain Establishment Fear Mongering - Nadeem_Walayat
8.Gold Price Possible $200 Rally - Bob_Loukas
9.The Federal Reserve is Not Going To Raise Interest Rates and Destroy Gold - Michael_Swanson
10.Silver Miners’ Q1’ 2016 Fundamentals - Zeal_LLC
Free Silver
Last 7 days
The Numbers Add Up to Vindication for a Cautious Gold Bull. . . - 1st June 16
Will the Fed be Blind Sided by Stagflation? - 31st May 16
Gold Price Not Ready for a Final Intermediate Cycle Low - 31st May 16
EU Referendum - British People vs Establishment Elite, Vote LEAVE an Act of Defiance! - 31st May 16
Gold - Mr. Cool Cucumber is starting to Sweat - 31st May 16
AMAT Chirps, b2b Ramps, Yellen Hawks and Gold’s Fundamentals Erode - 31st May 16
Stock Market Re-Testing Overhead Resistance - 30th May 16
David Cameron Questioned on Out of Control Immigration at TEN TIMES Conservative Election Pledges - 30th May 16
Bitcoin Price Skyrockets And Is Now Up More Than 100% This Jubilee Year - 30th May 16
This Is Not The America My Parents Immigrated To In 1957 - 30th May 16
“Debt, Not The Economy, Reaches Escape Velocity” With Graham Mehl - 29th May 16
EU Referendum, Black Vote LEAVE or REMAIN? Which is Worse for Racism for Britain's Ethnic Minorities? - 29th May 16
Billionaire Gross: Jubilee Debt Relief as Prelude to New Global Economic Order - 29th May 16
Wargaming North Korea - Assessing the Threat - 29th May 16
EU REMAIN Population Forecasts - England 4.1 million Explosion, London Migration Crisis - 28th May 16
A Guide to the Trump-Sanders Debate - 28th May 16
Gold And Silver – At Significant Support. New “Story” Developing - 28th May 16
The Next Systemic Lehman Event - New Scheiss Dollar & Gold Trade Standard - 27th May 16
Energy and Debt Crisis Point to Much Higher Silver, Metals Prices - 27th May 16
Gold Junior Stocks Q1 2016 Fundamentals - 27th May 16
These Crisis Markets Are Primed to Deliver Big Gains, Platinum Never Cheaper! - 27th May 16
Operation Black Vote BrExit Warning for the Wrong EU Referendum - 27th May 16
UK Immigration Crisis Hits New Extreme, Catastrophic ONS Migration Stats Ahead of EU Referendum - 27th May 16
Many of the World’s Best Investors Made Their Fortunes This Way…And You Can Too - 27th May 16
The Ugly Truth About Stock Market Manipulation and Gold Prices - 27th May 16
Gold Price Looking Vulnerable While Gold Stocks Correct - 27th May 16
The 5 Fatal Flaws of Trading - 27th May 16
The Next Big Crash Of The U.S. Economy Is Coming, Here’s Why - 27th May 16
A New Golden Bull or Has the Market Gone Too Far Too Fast? - 27th May 16
It Feels Like Inflation - 26th May 16
Negative Interest Rates Set to Propel the Dow Jones to the Stratosphere? - 26th May 16
S&P Significant Low has Occurred – Not Likely! - 26th May 16
Statistics for Funeral Planning in UK Grave - 26th May 16
Think Beyond Oil And Gold: Interview With Mike 'Mish' Shedlock - 26th May 16
Hard Times and False Mainstream Media Narratives - 26th May 16
Will The Swiss Guarantee 75,000 CHF For Every Family? - 26th May 16
Is There A Stocks Bear Market in Progress? - 26th May 16
Billionaires Are Wrong on Gold - 26th May 16
How NOT to Invest in the Gold Market - 26th May 16
The Black Swan Spotter...Which Saw the Oil-Crash coming; now says the “Invisible Hand” will push Brent to $85 by Christmas - 26th May 16
U.S. Household Debt Still Below 2008 Peak - 25th May 16
Brexit: Wrong Discussion, Wrong People, Wrong Arguments - 25th May 16
SPX is at Strong Resistance - 25th May 16
US Dollar, Back From the Grave? - 25th May 16
Gold : Just the Facts Ma’am - 25th May 16
The Worst Urban Crisis in History Could be Upon Us - 24th May 16
Death Crosses Across The Board Are IRREFUTABLE Stock Market Sell Signals - 24th May 16
Bitcoin Trading Alert: Bitcoin Price Stays below $450 - 24th May 16
Stock Market Crash Death Cross Doom Prevails - 23rd May 16
Did AMAT Chirp? Implications for the Economy and Gold - 23rd May 16
Stocks Extended Their Rebound On Friday - Will They Continue Higher? - 23rd May 16
UK Treasury Propaganda Warns of 3.6% Brexit Recession, the £64 Billion Question? - 23rd May 16
Stock Market Support Breached, But Not Broken! - 23rd May 16
George Osborne Warns of 18% Cheaper House Prices - BrExit for First Time Buyers - 22nd May 16
Gold Bull-Phase I Continues to Confound (The Trek to “Known Values”) - 22nd May 16 r
Avoiding a War in Space - 22nd May 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Why 95% of Traders Fail

Investing in Semiconductor Stocks: Three Chipmakers on the Upswing

Companies / Tech Stocks May 11, 2012 - 11:28 AM GMT

By: Money_Morning

Companies

Best Financial Markets Analysis ArticleDeborah Baratz writes: Global semiconductor sales have been pretty listless lately, but new data suggests a turnaround is on the horizon for this sector.

In fact, one new forecast by research firm IDC predicts the rate of growth in the semiconductor sector could potentially double in the latter part of this year.


For semiconductor stocks, this newfound growth could provide a big lift in profits.

Even smaller chipmakers may have suitors knocking on their doors for takeovers as they look to increase their market share.

What does this mean for investors?

Now is the time to start looking for the next big winner in semiconductors.

Here's why.

Semiconductor Stocks in 2012
According to IDC,semiconductor sales increased 3.7% to $301 billion last year thanks to increased orders for wireless-device chips.

But 2012 looks even better. The forecast has worldwide semiconductor sales increasing 6%-7%. This will come from declining customer inventories and the never-ending demand for smartphones, tablets and "iDevices."

According to the Semiconductor Industry Association (SIA), March worldwide semiconductor sales were already $23.3 billion, up 1.5% from the previous month.

"We are encouraged to see that sequential growth resumed across all regions, especially in Europe and Japan, in March," said Brian Toohey, president of SIA. "We look for seasonal moderate growth to continue in the second quarter and build momentum as 2012 progresses."

Across the globe, European sales increased 3.8% in March, while Japanese sales rose 1.2%. Along with improving macroeconomic conditions and a recovering supply chain from the 2011 Thailand floods, SIA sees an improved outlook.

Semiconductor companies are already reflecting the improvement.

Intel Corp. (Nasdaq: INTC), the world's largest chipmaker, just announced a 7.1% rise in its quarterly dividend to $0.225 cents. Thanks largely to the mobile phone market, INTC believes it is now poised to see "record revenues" this year.

According to Paul Otellini, president and chief executive officer, "Strong demand in our core business and significant progress in smartphones will help drive the gains. This latest dividend increase is one more example of our commitment to return cash to our stockholders."

Qualcomm Inc. (Nasdaq: QCOM) is another.

The chipset maker recently saw its total revenue rise 27.7% year over year to $4.94 million in Q2, surpassing the $4.85 million in analysts' estimates.

Going into the rest of the year QCOM has record-high earnings, a solid balance sheet, lots of product in the pipeline and improved market segmentation.

Investing in Semiconductor Companies: Three Winners
With the recent spate of earnings reports, semiconductor stocks are clearly on the upswing.

Here are three semiconductor stocks worth taking a serious look at:

•Advanced Micro Devices (NYSE: AMD): The second largest producer of microprocessors, GPUS and chipsets worldwide, AMD has a $5.07 billion market cap.
On April 19, the company reported its first quarter earnings and saw its revenue fall 1% year over year with a 6% decline from the first quarter. But its adjusted profit per share rose 50% from the previous year's period.

The company expects its second quarter revenue to either be flat or to increase up to 3% from the first quarter to $1.63 billion. Analysts had expected $1.59 billion for the quarter.

But don't be put off by the recent figures.

AMD plans to cut its costs for cloud computing and the number of data centers it operates globally through "the help of the cloud and hardware upgrades."

Its plan is to move more tasks to the cloud and subsequently open data centers in areas with fewer costs and a smaller tax burden. Increased use of cloud technology will give the company's engineers the opportunity to create chips regardless of where they reside.

Showing additional commitment to change, the company recently announced a new CMO, Collette LaForce. The Dell veteran will restructure the company's global marketing efforts, enhance the company's voice and assist in positioning it for growth.

•Texas Instruments (Nasdaq: TXN): Practically synonymous with semiconductors, TXN sells to electronics designers and manufacturers worldwide. It operates in four segments including analog, embedded processing, wireless and specialized.
Texas Instruments has a $36.85 billion market cap and is the fourth-largest semiconductor company when measured by 2011 revenue.

The company recently announced the "industry's most highly integrated audio codec with embedded miniDSP cores, providing echo and noise cancellation at wideband voice sampling rates up to 16 kHz."

What does this mean? Innovative change.

The company believes it will be a year of growth and reported first quarter revenue of $3.12 billion. According to a recent SEC 10-q filing, "We are poised for growth and share gains as markets rebound. Our product portfolio is strong, and our design position with customers is excellent. Our inventory is well-staged, and production in our factories is ramping. We expect 2012 to be a good year for growth."

Analysts agree. Wedbush Research believes the company will outperform the market.

According to Wedbush, "We believe TI's better-than-expected top-line guidance validates our view that the semi industry's recovery has begun."

•ARM Holdings (NASDAQ: ARMH): The business of ARMH is microprocessors, physical intellectual property (IP) and other related technology and software. It also sells development tools. Most of the chips it designs can be found in smartphones and tablets.
With a market cap of $12.81 billion, ARM Holdings is in a good position to capitalize on the growing mobile market.

The company released strong first quarter numbers on April 23 and increased its full-year revenue target. In all, analysts were happy with the report while Raymond James upgraded ARMH to a strong buy from outperform.

According to Raymond James analyst Michael Rose, "We heard nothing to dissuade us from our belief that ARM remains one of the strongest secular growth stories in tech. ARM remains the de facto leader in smartphones/tablet processors, which is dovetailed by strong licensing trends in non-traditional markets such as microcontrollers, set-top boxes, disk drives, and digital TVs that will drive an incremental royalty stream over the next five years."

ARM's rivalry with Intel Corp. has intensified, but Rose sees it as "more opportunity than risk."

A bright spot in the competition is ARM's "design/multi-sourcing/eco-system" which edges out Intel's process technology/sole sourcing," noted Rose. "We remind investors that Intel's retreat from digital consumer, in our opinion, is due single-handedly to ARM momentum in that space in 2012."

Source :http://moneymorning.com/2012/05/11/investing-in-semiconductor-stocks-three-chipmakers-on-the-upswing/

Money Morning/The Money Map Report

©2011 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife