Maxim Integrated Products, Inc.
) has recently announced the pricing of senior unsecured notes
aggregating $500 million. These bonds carry a coupon rate of
2.500% and are due to mature in 2018. The offering is expected to
close on Nov 21, 2013, subject to customary closing
Maxim stated that the net proceeds would be used for general
corporate purposes, acquisitions and share repurchases. Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley
& Co. LLC and Stifel, Nicolaus & Company, Incorporated
will be acting as joint book-running managers for the
Maxim is a leading manufacturer of analog integrated circuits.
In the recently concluded first-quarter fiscal 2014, the company
spent $74.0 million on cash dividends and used $154.0 million to
repurchase its common stock.
At quarter-end, the company had cash and short-term
investments balance of $1.03 billion, down $165.5 million or
13.8% during the quarter. The company had $501.0 million in
long-term debt on its balance sheet. Currently, the company's
debt-to-total capitalization ratio is 17.4%, which will increase
after the issuance of these notes.
We believe that Maxim has a strong balance sheet, which will
help the company to capitalize on investment opportunities and
make strategic acquisitions, further improving its growth
prospects. We believe the senior notes offering will bring down
its cost of capital, thus strengthening the company's balance
sheet and supporting growth.
Currently, Maxim has a Zacks Rank #3 (Hold). Other stocks that
are performing well at current levels include
Best Buy Inc.
Protalix BioTherapeutics, Inc.
). All these stocks carry a Zacks Rank #1 (Strong Buy).
BEST BUY (BBY): Free Stock Analysis Report
MAXIM INTG PDTS (MXIM): Free Stock Analysis
PROTALIX BIOTHR (PLX): Free Stock Analysis
TIVO INC (TIVO): Free Stock Analysis Report
To read this article on Zacks.com click here.