Low expectations, upgrade help Maxim rally post-earnings

|About: Maxim Integrated Products, ... (MXIM)|By:, SA News Editor

After seeing Maxim's (MXIM +1.5%) shares badly underperform the Nasdaq in 2013, investors are giving a pass to the analog/mixed-signal chipmaker for missing FQ2 EPS estimates and providing FQ3 guidance ranges - revenue of $590M-$620M and EPS of $0.37-$0.41 - whose midpoints are below a consensus of $618.3M and $0.40.

Also helping Maxim's cause: Susquehanna's Chris Caso has upgraded shares to Positive. Caso, who smartly downgraded Maxim in June, is pleased with CC remarks (transcript) suggesting Maxim's content share within top customer Samsung's Galaxy S5 (expected to launch in March) will be up relative to its share for the S4. S5-related shipments are expected to ramp late in the March quarter.

Caso also believes Maxim's industrial chip sales "can continue to perform well in the context of a continuing modest cyclical recovery," and notes the company's valuation (14x FY15E EPS) is lower than those of analog chip peers.