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Thursday, Aug 15
Sell-side likes Maxim/Volterra; OTR Global worried about Samsung sales
- Analysts have mostly given a thumbs-up to Maxim's (MXIM -3.4%) purchase of high-power analog chipmaker Volterra (VLTR +54.8%).
- Needham expects the all-cash deal to boost FY14 EPS by $0.05 and FY15 EPS by $0.10, bolster Maxim's server power management IC (PMIC) business, and help it expand within the telecom infrastructure, solar, and battery markets.
- The firm also expects Maxim to eventually use Volterra's voltage envelope-tracking tech in its mobile PMICs.
- The rising popularity of ultra-dense, "hyperscale," server deployments within Web/cloud data centers is forcing companies to get creative when it comes to power management and heat dissipation. That, in turn, could strengthen demand for Volterra's high-current ICs.
- Evercore offered a more subdued take on the deal, calling it the "best possible outcome" for Volterra in light of tough competition and a lack of near-term revenue catalysts. Volterra has been forecast to see a 12% Y/Y sales drop in 2013, thanks in part to notebook-related weakness.
- Separately, OTR Global is worried Samsung (27% of Maxim's revenue) has developed a home-grown PMIC, something that could lead it to buy fewer of Maxim's.
- Maxim/Volterra CC transcript