Maxim (Nasdaq:MXIM), Marvell (Nasdaq:MRVL), ONNN (Nasdaq:ONNN), National Semi (NYSE:NSM), Fairchild (NYSE:FCS), Int'l Rectifier (NYSE:IRF), Microsemi (Nasdaq:MSCC), Broadcom (Nasdaq:BRCM) Have Most Semi Upside

With earnings reports from a number of semiconductor companies to be released next week, FBR focused on a number of companies in the sector, saying Maxim (Nasdaq:MXIM), Marvell (Nasdaq:MRVL), ON Semiconductor (Nasdaq:ONNN), National Semi (NYSE:NSM), Fairchild (NYSE:FCS), Int'l Rectifier (NYSE:IRF), Microsemi (Nasdaq:MSCC) and Broadcom (Nasdaq:BRCM) have the most upside potential of the group.

FBR says, "Several chip firms report earnings over the next week, including Linear Technology (Nasdaq:LLTC)(UP) Tuesday AMC, Fairchild Semi (FCS)(OP), Thursday BMO, Maxim Integrated (MXIM)(OP) Thursday AMC, AMD (NYSE: AMD)(MP) Thursday AMC, and Texas Instruments (NYSE: TXN)(OP) Monday AMC. For near-term focused investors, we think FCS and MXIM could see solid share price appreciation following beat and raise results, with TXN also possibly in that camp (though our conviction is slightly lower). While both MXIM and FCS have appreciated meaningfully in the near term, robust results and still-attractive stock valuations keep us favorable near term. For AMD, while the firm could post solid 1Q11 guidance, the departure of former CEO Dirk Meyer is likely to weigh on the stock and overshadow any near-term results until a full-time successor is found. For Linear, we think the firm's core business remains solid; however, several headwinds are present in the March quarter, including (1) a possible loss of one of its two iPad sockets (we estimate content going from $2 to $1) and some iPad seasonality in March, driving a roughly $10M revenue headwind in total (three revenue points), and (2) tougher comparisons against the firm's 14-week December quarter (about four revenue points). For Texas Instruments, we think the firm will report robust results and guidance, and the stock could possibly rally, though we prefer MXIM (growth) or NSM (value) versus TXN currently. Finally, for ON Semi (ONNN–OP), we are raising our 4Q10 revenue and EPS estimates slightly toward the high end of guidance, embedding Sanyo into our financial estimates, and raising our price target from $15 to $16."

"While the group could see some profit-taking following such a move higher, we do expect some beat and raise 4Q10 results and thus think any sell-off will be short term in nature and a likely buying opportunity for later in 2011. Our favorite stocks for upside include Maxim (Nasdaq: MXIM), Marvell (MRVL), ONNN, National Semi (NSM), Fairchild (FCS), Int'l Rectifier (IRF), Microsemi (MSCC), and Broadcom (BRCM)."