NXPI Stock Rises On Samsung Takeover Talk

Samsung reportedly is eyeing an acquisition of European chipmaker NXP Semiconductors (NXPI) to increase its exposure to the automotive chip market. NXPI stock jumped on the news.

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Asian Tech Press reported Wednesday that Samsung’s de facto leader Lee Jae-yong plans to discuss a possible purchase of the Netherlands-based chipmaker during his visit to Europe June 7-18.

An acquisition of NXP would have the added benefit of locking up a major customer of Taiwan Semiconductor Manufacturing (TSM), or TSMC, Asian Tech Press said. Samsung competes with TSMC in the chip foundry business that serves fabless semiconductor companies.

Samsung is bullish on the automotive semiconductor space as chip content increases in cars amid the shift to electric vehicles and autonomous driving, the report said.

NXPI Stock Jumps On Takeover Talk

On the stock market today, NXPI stock popped 4% to close at 184.22. Meanwhile, TSM stock dropped 2.8% to 90.85.

NXPI stock ranks No. 14 out of 34 stocks in IBD’s fabless semiconductor industry group, according to IBD Stock Checkup. It has a so-so IBD Composite Rating of 73 out of 99. IBD’s Composite Rating is a blend of key fundamental and technical metrics to help investors gauge a stock’s strengths. The best growth stocks have a Composite Rating of 90 or better.

Semiconductor stocks have been beaten down lately on concerns that the uptrend in the chip cycle has peaked. IBD’s fabless semiconductor group ranks No. 158 out of 197 industry groups that IBD tracks. Six months ago, it was the No. 1 group.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.

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