Semiconductor Stocks: NXP, Cirrus Logic Post Earnings

Chipmaker NXP Semiconductors (NXPI) late Monday beat Wall Street’s targets for the fourth quarter and increased its quarterly dividend 50%. NXP kicked off a busy earnings week for semiconductor stocks.

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Netherlands-based NXP earned an adjusted $3.20 a share on sales of $3.04 billion in the December quarter. Analysts expected adjusted earnings of $3.01 a share on sales of $3 billion, according to FactSet. In the year-earlier period, NXP earned $2.15 a share on sales of $2.51 billion.

The Dutch chipmaker also increased its quarterly cash dividend 50% to 84.5 cents a share. Plus, it announced a new $2 billion share repurchase program. The new stock buyback plan is in addition to the $1.35 billion in repurchase authorizations still remaining on its prior plan.

For the current quarter, NXP expects to generate $3.1 billion in revenue vs. Wall Street’s target of $2.96 billion.

NXPI Stock Climbs In Late Trades

In after-hours trading on the stock market today, NXPI stock rose 0.3%, near 206. During the regular session Monday, NXPI stock jumped 8.4% to 205.44 during a big up day for the overall market.

NXP makes chips for automotive, industrial, mobile, Internet of Things, and communication infrastructure markets.

Cirrus Logic Pops On Upbeat Report

Elsewhere among semiconductor stocks, audio-chip maker Cirrus Logic (CRUS) late Monday delivered a beat-and-raise report for the December quarter.

Austin, Texas-based Cirrus Logic earned an adjusted $2.54 a share on sales of $548.3 million in its fiscal third quarter ended Dec. 25. Analysts had expected earnings of $2.14 a share on sales of $510 million, FactSet said. In the year-earlier period, it earned $2.13 a share on sales of $486 million.

For the current quarter, it expects to generate sales of $400 million to $440 million. The midpoint of $420 million is well above analyst expectations of $354 million for the March quarter.

In late trading, CRUS stock jumped 9.6%, near 98.

CRUS stock ranks No. 11 out of 31 semiconductor stocks in IBD’s fabless semiconductor industry group, according to IBD Stock Checkup. It has an IBD Composite Rating of 92 out of 99. NXPI stock ranks No. 13 in the group.

Semiconductor Stocks Peaking?

Tuesday will bring earnings reports from three more semiconductor stocks: Advanced Micro Devices (AMD), Allegro MicroSystems (ALGM) and Entegris (ENTG). Wireless-chip maker Qualcomm (QCOM) and five others will post December-quarter results on Wednesday.

On Monday, Jefferies analyst Mark Lipacis said investors should be cautious when it comes to chip stocks. In a note to clients, he said semiconductor stocks “have entered the peaking process.”

He based his conclusion on an analysis of previous peaks of semiconductor stocks in 2014-15 and 2017-18. Those prior two cycles were characterized by volatile trading with multiple mini-peaks and troughs. The peaking process typically lasts about six months before semiconductor stocks roll over, he said.

However, Lipacis suggested seven semiconductor stocks that look attractive after recent sell-offs. They include AMD, Lam Research (LRCX), Marvell Technology (MRVL), Microchip Technology (MCHP), Nvidia (NVDA), NXP and ON Semiconductor (ON).

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

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