Analyst Joshua Buchalter from TD Cowen maintained a Buy rating on NXP Semiconductors and increased the price target to $270.00 from $210.00.
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Joshua Buchalter has given his Buy rating due to a combination of factors including NXP Semiconductors’ constructive outlook on demand and inventory health, which appears more positive compared to the first quarter. Despite potential trade friction that could affect the second half, the cyclical signals suggest cautious optimism. The company’s second-quarter results were solid, and the guidance for the third quarter indicates improving cyclical trends, particularly in the automotive and industrial segments.
Furthermore, NXP’s channel inventory management and recovery signs in core and consumer-oriented industrial markets are seen as positive indicators for future growth. Although the gross margin leverage is expected to be slow and steady, the company is making strategic moves such as capital outlays for joint ventures to secure future supply. Overall, the expectation of gradual earnings per share growth, barring unforeseen trade or demand issues, supports the Buy rating.
Buchalter covers the Technology sector, focusing on stocks such as Advanced Micro Devices, Texas Instruments, and Qualcomm. According to TipRanks, Buchalter has an average return of 7.6% and a 54.94% success rate on recommended stocks.
In another report released yesterday, Barclays also maintained a Buy rating on the stock with a $220.00 price target.