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Microchip Expands RF Portfolio - Analyst Blog

Posted
9/27/2012 6:35:00 PM
By: Zacks.com
Referenced Stocks:EVM;FSL;MCHP

Recently Microchip Technology, Inc. ( MCHP ) declared the inclusion of its latest SST11CP16 5 GHz power amplifier (PA) in its product profile. With the addition of the newest PA in its product line, the company has expanded its RF portfolio.

The newly launched product is particularly designed for supporting IEEE 802.11ac ultra high data rate Wi-Fi standard system in a minimized Error Vector Magnitude (EVM). In addition, it offers low operating current to enhance the transmission range for a high data rate.

The SST11CP16 PA is appropriate for various applications of set-top boxes, routers, access points and Wi-Fi devices, which require data rates of 3Gbps. In addition, PA has an input and output match and a linear power detector. Microchip's advanced state-of-the-art technologies would allow for low power consumption and highly productive amplifiers.

Microchip develops and manufacturers microcontrollers, memory and analog and interface products for embedded control systems, which are small, low-power computers designed to perform specific tasks. The company's revenues declined 6% annually to $352.1 million for the first quarter of fiscal 2013. However, management expects net sales between $412 million and $430 million in the second quarter of fiscal 2013, up 17% - 22% sequentially.

Microchip competes against significantly larger companies with greater financial resources, such as Freescale Semiconductor, Ltd. ( FSL ) and Renesas Electronics Corporation. New market entrants are also increasingly targeting embedded control applications, which could negatively impact the company's financial performance in the future.

The current Zacks Consensus Estimates for the second quarter of fiscal 2013 and for fiscal 2013 are 47 cents per share and $1.90 per share, respectively. The company currently retains a Zacks #1 Rank, which translates into a short-term 'Strong Buy' rating. We also have a 'Neutral' recommendation on the company's stock.


 
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