How Key Analyst Views NXP Semiconductors After the Freescale Close

Technology

Published: December 11, 2015 11:35 am

Last Updated: January 13, 2020 4:11 pm

This week there has been a large amount of merger and acquisitions activity in the market, but ultimately the market has not really taken to it. This seems to be the case with NXP Semiconductors N.V. (NASDAQ: NXPI). Earlier in the week NXP announced the closing of its Freescale acquisition, and a key analyst decided to weigh in on it.

The new NXP is one of the best deleveraging/financial engineering stories in semiconductors, in Oppenheimer’s view, ideally positioned to benefit from continued auto semi content/growth, among other trends.

This announcement lacked a detailed combined financial update, which was somewhat surprising considering recent disappointing fourth-quarter guidance from both companies. However, NXP did reiterate its commitment to achieving $200 million of annual synergies in the 2016 calendar year and continues to see a “clear path” to $500 million over time.

Oppenheimer reiterated an Outperform rating for NXP with a $100 price target. At the same time, the firm set its calendar 2016 and 2017 earnings per share (EPS) estimates at $5.40 and $7.10, respectively.