Tag Archives: adi

Macom Leapfrogs Apple-Supplying Chip Rivals With Lasers, Radar

FAA and NOAA demand for weather applications will drive approximately $500 million in additional annual revenue over the upcoming five years for IBD Leaderboard stock  Macom Technology Solutions ( MTSI ), a Needham analyst said Friday following the chipmaker’s “upbeat” analyst day. Macom stock rose 5.8% on the stock market today , to 43.79 — nearing its all-time high of 44.15, achieved Monday — and extended 5.7% from a 41.42 buy point. IBD’s 41-company Electronics-Semiconductor Manufacturing industry group jumped 2.3% Friday, spurred by Macom. Shares of chip rivals Analog Devices ( ADI ),  Qorvo ( QRVO ) and Skyworks Solutions ( SWKS ) — all Apple ( AAPL ) suppliers — rose 1.2%, 2.2% and 3.5%, respectively. Needham analyst N. Quinn Bolton reiterated his buy rating and 46 price target on Macom stock. Barclays boosted its price target on Macom stock to 44 from 41 and maintained an overweight rating. Macom Ogles Vast Growth Optical, gallium nitride (GaN) and active antenna radar could each double Macom’s approximately $500 million revenue over the next three to five years, “potentially driving up to $2 billion of annual revenue by 2020,” Bolton wrote in a research report. “While management was clear the team may not bat 1,000 and that timing of specific product ramps was difficult to accurately forecast, management has clearly set an objective to become a much larger company,” he wrote. Macom’s $2.3 billion market cap puts it distantly behind industry leader Intel ( INTC ) and Intel’s $150 billion market cap. Unlike its Apple-supplying rivals, Macom’s chips aren’t focused on consumer products but instead are used in commercial and industrial applications like cellphone base stations, military radar and lasers. Macom also is developing GaN-on-silicon chips, squaring off with privately held Transform, Infineon Technologies and Efficient Power Conversion (EPC). GaN transistors can turn on and off faster than silicon, can withstand a higher voltage and are markedly smaller. Could Gallium Nitride Take On Silicon? Last year, EPC figured out how to make them cheaper, too, EPC CEO Alex Lidow told IBD in February. Lidow used to head up International Rectifier, which Infineon acquired in 2014. Companies like EPC aim to use GaN in electronic components such as transistors. EPC grows a thin layer of gallium nitride on silicon wafers and, like Macom, it uses the chips in cellphone base stations. “GaN is being used in base stations, going up in Google balloons and Facebook ( FB ) drones,” Lidow said. Other applications include a swallowable colonoscopy pill, autonomous cars ( Alphabet ( GOOGL ) and Tesla Motors ( TSLA ) are among the competitors) and wireless charging. Lidow estimates a $370 billion total addressable market — $30 billion in power, $40 billion in analog and $300 billion in digital. Macom is trying to grab some of it. The company has been in talks with smartphone makers Huawei, Nokia ( NOK ) and Ericsson ( ERIC ) for over a year and just recently completed customer validation, Bolton wrote. “If the commercial contract negotiations go well, management believes the company could generate first production revenue for GaN-on-Si (GaN-on-silicon power amplifiers) by year-end 2016,” he wrote. Macom estimates that it can scoop 40%-60% of the base station power amplifier market over the next three to five years. RELATED: 5 Chip Stocks To Watch, Moving Up, With Apple’s Big Event March 21

Apple Suppliers Cirrus Logic, Analog Devices Begin iPhone 7 Prep

Apple ( AAPL ) suppliers Cirrus Logic ( CRUS ) and Analog Devices ( ADI ) are lapping up foundry capacity in the back half of 2016 in anticipation of the iPhone 7, expected to be released in September, according to a report. The duo recently requested that foundry and back-end service providers reserve a significant portion of production capacity in Q2 and Q3, industry insiders told Digitimes.com. In afternoon trading on the stock market today , Cirrus Logic stock was up nearly 4%, and Analog Devices stock was up a fraction. Cirrus Logic and Analog Devices are expected to have a big impact on the design of Apple’s iPhone 7, which is widely expected to be the name of the next phone in Apple’s smartphone line. Audio chipmaker Cirrus Logic began touting its noise-canceling headphones in January. “There are definitely people considering putting that (noise-canceling headphones) in the (mobile) box,” Cirrus Logic CEO Jason Rhode said during the company’s earnings conference call. But Rhode didn’t specifically mention the iPhone. Apple generally encourages suppliers to refrain from any such comments. Apple’s iPhone 7 is expected to be thinner, ditching the headphone jack in favor of a Lightning cord connection. The iPhone 7 will also likely include Force Touch — a feature introduced in the iPhone 6S, which was released last September. Analog Devices is the rumored provider for the Force Touch technology, but tear-downs don’t make the supplier apparent. And it appears that Taiwan Semiconductor Manufacturing ( TSM ) will manufacture the lion’s share, if not all, of Apple’s A10 processors, insiders told Digitimes. Taiwan Semiconductor and Samsung both sourced the A9 inside the iPhone 6S series. That was the first time that the two companies shared this job. Previously, the pair had battled for Apple’s processor-supply manufacturing contract, leapfrogging each other from year to year. In December, Wall Street began whispering that Samsung wouldn’t pursue the A10.

Signet, Veeva Among Top Earnings Reports Due Tue.

Earnings season is winding down, but it’s not over yet. Your top earnings reports to watch Tuesday are from Analog Devices (ADI), Tech Data (TECD), Signet Jewelers (SIG) and Veeva Systems (VEEV). Apple (AAPL) chip supplier Analog Devices has an IBD Composite Rating of 79 out of 99 and reports before the open. Its earnings are projected to grow 20% while revenue increases 12%. IT product distributor Tech Data also reports before the open. Earnings