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Maxim Integrated Products Reaps Price-Target Hikes Post-Earnings

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Chipmaker Maxim Integrated Products ( MXIM ) scored at least 10 price-target increases on its stock Friday after delivering better-than-expected earnings in the September quarter and guiding higher for sales and earnings in the December quarter.

The main quibble with its September-quarter report late Thursday was that sales came in just below estimates.

Maxim shares were up 4% to close at 52.09 on the stock market today . Earlier in the session, it climbed as high as 53.10, its highest level since February 2004. Maxim cleared a buy point of 49.80 out of a flat base on Tuesday.

Of the 10 price-target hikes Maxim received, seven were from Wall Street firms with buy ratings or the equivalent on the stock. The most bullish of the bunch were Drexel Hamilton and Jefferies, which raised their targets to 60.

Maxim is benefiting from a "renaissance" in the analog chip market, Jefferies analyst Mark Lipacis said. On Thursday, before Maxim reported earnings, Lipacis upped his price target on the stock to 58 from 51. Post-earnings, Lipacis raised his target to 60.

"We think the Street is underestimating the profitability and EPS potential of Maxim and other analog companies," Lipacis said in a report late Thursday.

IBD'S TAKE:Maxim Integrated Products has an IBD Composite Rating of 88, meaning it has outperformed 88% of stocks in key metrics over the past 12 months. For more analysis of Maxim and its peers, visit the IBD Stock Checkup .

Morgan Stanley analyst Craig Hettenbach called Maxim's September-quarter results "mixed" and noted the company's "underwhelming sales."

"Maxim missed sales for the second straight quarter in a row despite this being the strongest analog upcycle in 7 years," he said in a report Friday. "Days of inventory in distribution increased 7 days quarter-to-quarter to 68, or 12 days above the 5-year median."

Hettenbach rates Maxim stock as underweight, but increased his price target to 42 from 40.

San Jose, Calif.-based Maxim reported adjusted earnings per share of 60 cents, up 25% year over year, on revenue of $575.7 million, up 3%, in its fiscal first quarter ended Sept. 23. Analysts expected 56 cents and $ 576.75 million.

For the current quarter, Maxim expects to earn 64 cents a share excluding items, up 39% year over year, on sales of $620 million, up 13%, based on the midpoint of its guidance. Wall Street was modeling 57 cents and $583.9 million.

RELATED:

Maxim Shares Rise Late On Earnings Beat, Bullish Guidance

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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