Thursday, August 11, 2011

Intel (INTC) (QCOM) (BRCM) (NXPI) Top Barclays Semi List

Going against the grain on the outlook for the semiconductor market, Barclays Capital analyst C.J. Muse said in a long report this morning that he has raised his rating on the sector from "Neutral" to "Positive." His favorites in the sector are Intel (NASDAQ:INTC), Qualcomm (NASDAQ:QCOM) and Broadcom (NASDAQ:BRCM).

Muse said he sees the downward trend in the industry as a “mid-cycle correction” rather than a long-term downturn in the semiconductor industry.

While acknowledging the industry won't perform as in the past, Muse sees it growing at an annual rate of 6 percent to 8 percent going forward. He cites a 0.97 correlation between the semi market and global GDP growth rate, which appears to be headed for 7 percent in 2011 and 2012, according to the calculations of Muse.

Along with his positive outlook on Intel, which he boosted its rating to "Overweight," Muse also did the same for Altera (ALTR) and Spansion (CODE). Top picks include NXP Semiconductors (NXPI), Qualcomm (QCOM), and Broadcom (BRCM), which are also rated "Overweight."

On the negative side, Muse lowered his rating on Xilinx (XLNX), Analog Devices (ADI), Micron Technology (MU) and Nvidia (NVDA), dropping them to "Equal Weight."

He reiterated his "Equal Weight" ratings on Texas Instruments (TXN), Freescale Semiconductor (FSL) and Linear Technology.

No comments: