Technology

What to Expect From NXP Semiconductor Earnings

Chris Lange

Published: April 25, 2016 11:35 am

Last Updated: January 13, 2020 10:20 am

NXP Semiconductors N.V. (NASDAQ: NXPI) is set to report its first-quarter financial results after the markets close on Monday. The consensus estimates from Thomson Reuters call for $1.09 in earnings per share (EPS) on $2.21 billion in revenue. In the same period of last year it posted EPS of $1.35 and $1.47 billion in revenue.

This is considered a top play for investors looking for a chip stock with Internet of Things exposure, and it is down a stunning 38% from highs printed in June of 2015. The NXP merger with Freescale Semiconductor was widely applauded on Wall Street, and many analysts believe the merger is transforming the company into a powerhouse.

The merger made NXP the fourth largest semiconductor company in the industry. It is also important to note that the combined company would be the number one supplier in auto semiconductors, the number one supplier in global microcontrollers and a dominant supplier in mobile payments.

NXP is getting its chips into high-growth areas such as contactless mobile payments, the Internet of Things, mobile-phone charging, increased cellular data consumption and LED lighting. With shares trading at a massive 40% discount to peers, analysts are very positive on the faster earnings growth potential relative to the competition.

Ahead of the earnings report a few analysts weighed in on the company:

• Morgan Stanley reiterated a Buy rating.
• Raymond James has an Outperform rating.
• Deutsche Bank reiterated a Buy rating with a $110 price target.
• FBR reiterated an Outperform rating with a $105 price target.
• Credit Suisse reiterated an Outperform rating with a $120 price target.

So far in 2016, NXP has performed more or less in line with the broad markets, with the stock practically flat year to date. Over the past 52 weeks, the stock is down about 15%.

Shares of NXP were trading down 1% at $83.48 Monday morning, with a consensus analyst price target of $104.25 and a 52-week trading range of $61.61 to $114.00.