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More on Piper's upgrade of Freescale (FSL +10.6%): Analyst Gus Richard is raising his revenue...

More on Piper's upgrade of Freescale (FSL +10.6%): Analyst Gus Richard is raising his revenue and gross margin forecasts, citing expectations of higher fab utilization and a bigger mix of high-margin RF/networking chip sales. He also thinks Freescale's efforts to restructure its debt/lower interest expense could yield additional EPS upside. Thanks to its P-E legacy, Freescale had $6.4B in debt on its balance sheet as of March 28, to go with $767M in cash. Shares +74% since Gregg Lowe was named CEO in June '12.
Comments (3)
  • Ashraf Eassa
    , contributor
    Comments (8826) | Send Message
     
    Big fan of FSL, but have always been super uncomfortable about the huge debt position.
    9 Jul 2013, 01:26 PM Reply Like
  • ericmcarter
    , contributor
    Comments (179) | Send Message
     
    Does anyone have any color on the declining PPE for FSL? In early 2008, PPE averaged $2.3b and as of Q1 '13 it's less than $700m. Meanwhile it looks like CAPEX has declined as well through the years. With $6.4b in debt, how will FSL finance a large CAPEX program (if needed) to replenish their productive, fixed asset base? Also, in the last 21 quarters (back to early '08), FSL has never generated positive net income (ex gains from extinguishing debt). Am I missing something here?
    9 Jul 2013, 01:52 PM Reply Like
  • Hubert Biagi
    , contributor
    Comments (690) | Send Message
     
    Gregg Lowe was on track to and should have replaced Rich Templeton at Texas Instruments. The insider corporate culture over there allowed (encouraged) Greg to get away.
    9 Jul 2013, 01:53 PM Reply Like
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