For Immediate Release
Chicago, IL – February 25, 2010 – Zacks.com announces the latest Industry Outlook. Today, Zacks Equity Research discusses the Semiconductor Industry, including Texas Instruments (TXN), Analog Devices (ADI), Semtech Corp (SMTC), Intersil Corp (ISIL) and Linear Technology (LLTC).
A synopsis of today’s Industry Outlook is presented below. The full article can be read at http://www.zacks.com/stock/news/30932/Semiconductor+Update+%26amp%3B+Stock+Review.
Semiconductor Update & Stock Review
Manufacturing digital ICs is expensive, as it requires state-of-the-art technology and processes. On the other hand, digital products are cheaper, so cost recovery is more difficult. This has led to specialization in the industry and a greater contribution from Asian manufacturers.
Equipment suppliers will be big beneficiaries of the recovery and we are bullish on the sector. All the companies here had been severely impacted by the recession, as foundries, memory and logic makers decided to cut capex. However, both Gartner and IC Insights have projected a 45-55% increase in semiconductor capex spending in 2010.
The analog market is dependent on innovation. Consequently, these products generate higher margins. They are also more customized and have longer life cycles. These advantages are not lost on U.S. players, so the number of companies entering the market is on the rise.
Our favorites in this area include Texas Instruments (TXN), Analog Devices (ADI), Semtech Corp (SMTC), Intersil Corp (ISIL) and Linear Technology (LLTC) which are seeing very strong demand. Although some of these companies could see a faster recovery than others, they are, for the most part, highly diversified, high-margin businesses. Hence, the sector should do very well in 2010.
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