Wed, May 20, 5:35 PM
Fri, May 15, 6:05 PM
- After having exited a prior GM position a year ago, David Einhorn's Greenlight Capital bought 9.5M shares of the auto giant in Q1, per Greenlight's Q1 13F.
- Einhorn previously disclosed the purchase, along with his reasoning, in his Q1 letter. "2015 should be a better year for GM: the company is a year closer to eliminating its losses in Europe; low gas prices should stimulate demand for its highly profitable SUV and light truck product lines; raw material costs are low; and we believe that the worst of the product recalls is behind them." He also noted GM's buyback, and called earnings estimates beatable.
- A 1.7M-share stake was taken in Macy's (NYSE:M), and a 1.1M-share stake in Ingram Micro (NYSE:IM). Greenlight's stake in Chicago Bridge & Iron (NYSE:CBI) was more than doubled to 6.7M shares, and its stake in AerCap (NYSE:AER) hiked by 49% to 5.6M.
- On the flip side, Greenlight liquidated a 1.3M-share stakes in Aetna (NYSE:AET) and Amdocs (NASDAQ:DOX). The firm cut its stake in chipmaker/long-time holding Marvell (NASDAQ:MRVL) by 63% to 9M shares, and in chip equipment maker Lam Research (NASDAQ:LRCX) by 33% to 1.7M shares.
Wed, Apr. 29, 9:34 AM
- JMP Securities has downgraded Marvell (MRVL -1.3%) to Underperform 5 days after the company issued an FQ1 warning, and cut its target to $10.
- Craig-Hallum and Ladenburg Thalmann had already downgraded Marvell following the warning. Raymond James has defended the company, arguing its issues are "inventory-related in PCs and demand-related in China’s wireless markets – not market share related." The firm thinks Marvell is still well-positioned to gain hard drive/SSD controller share long-term.
- Benchmark (Hold), on the other hand, is worried Marvell lacks the scale to compete in the R&D-intensive mobile baseband chip market against Qualcomm and MediaTek, that PC weakness will make it tough for Marvell to grow hard drive/SSD SoC sales, and that its "highest volume [Wi-Fi] connectivity design wins are tied to ailing smartphone platform business and/or maturing consumer product cycles (e.g. PS3, Xbox One & Chromecast).”
- With shares having fallen sharply (along with other chip stocks) prior to the warning, they're down less than 3% since it was issued.
Fri, Apr. 24, 5:37 PM
Fri, Apr. 24, 5:32 PM
- Marvell (NASDAQ:MRVL) now expects FQ1 revenue of $710M-$740M, well below prior guidance of $810M-$830M and an $816.3M consensus. All other guidance has been withdrawn.
- The chipmaker blames "weaker than previously expected PC and storage markets and lower than expected emerging market demand." The former is presumably a reference to hard drive/SSD controller sales; the latter might be a reference to Chinese baseband chip sales.
- PC sales were down sharply in Q1, thanks in large part to weak corporate and Japanese demand. Meanwhile, analysts have voiced concerns about soft chip orders from Chinese smartphone OEMs.
- Shares have fallen to $13.50 AH. They fell 1.6% in regular trading after several peers offered soft guidance. Full FQ1 results arrive on May 21.
Fri, Apr. 24, 2:03 PM
- Though the Nasdaq is up 0.7% thanks to market-pleasing earnings from Google, Microsoft, and Amazon, chip stocks (SOXX -2.1%) are adding to their Thursday losses after Freescale, Altera, Microsemi, and Maxim joined the ranks of chipmakers offering soft Q2 guidance; Texas Instruments, Xilinx, and Qualcomm did so on Wednesday afternoon.
- NXP (NXPI -4.3%), set to merge with Freescale in a cash/stock deal, is selling off ahead of its April 29 Q1 report. RF chipmakers Skyworks (SWKS -3.8%), Qorvo (QRVO -4.4%), and Avago (AVGO -5.2%) are also seeing steep declines.
- Other decliners include a slew of telecom/networking, microcontroller, and analog/mixed-signal chipmakers. The group includes Marvell (MRVL -3%), ON Semi (ON -6.9%), Atmel (ATML -3.3%), Cypress (CY -4%), Lattice (LSCC -3.9%), Semtech (SMTC -6.9%), Cavium (CAVM -6%), PMC-Sierra (PMCS -2.9%), InPhi (IPHI -3.8%), and Silicon Labs (SLAB -2.9%). Chip packaging/testing firm Amkor (AMKR -5.7%) is also off; its Q1 report arrives on Monday.
- As was the case with TI and Xilinx, soft telecom equipment chip demand was often blamed by those guiding light yesterday afternoon. Freescale (FSL -3.5%) stated it expects network processor division sales to be down Q/Q and RF (base station power amplifier) division sales to be flat. Microcontroller, automotive, and analog and sensor division sales are expected to rise.
- Altera (ALTR -3.3%) stated its "telecom and wireless business, and particularly our wireless business globally looks to be quite weak in [Q2], while the rest for our business will in aggregate be flat to slightly up." Regarding its Q1 miss, the company notes "Industrial, test, compute and storage, and to a lesser extent military, fell short of our forecast" (share loss to Xilinx?).
- Maxim reports seeing "broad-based softness in communications infrastructure demand" and soft industrial bookings to go with healthier mobile/auto demand. The Galaxy S6 appears to be giving a lift to Maxim's mobile sales.
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Thu, Mar. 19, 5:52 PM
- After rising 5.8% in regular trading today, specialty analog/mixed-signal chipmaker Microsemi (NASDAQ:MSCC) is up 8% since announcing yesterday morning (just before its analyst day) it's buying Ethernet chipmaker Vitesse (NASDAQ:VTSS) for $389M. Shares have made new highs along the way.
- Vitesse closed today $5.31, $0.03 above Microsemi's offer price. Ascendiant Capital's Cody Acree calls the offer "a bit low," and (given the deal is expected to be immediately accretive for Microsemi) thinks a rival bid might arrive. "Potential suitors could include Broadcom (NASDAQ:BRCM) or Marvell (NASDAQ:MRVL), who are already leaders in Ethernet and would see natural synergies in VTSS’s portfolio or Avago (NASDAQ:AVGO) who has also been particularly acquisitive."
- Meanwhile, Stifel's Tore Svanberg has hiked his Microsemi target by $5 to $40 in response to the Vitesse deal and Microsemi's analyst day presentations (slides - .pdf). "[M]anagement reiterated its strategy to maximize profitability, grow its market share in core products, while expanding its [addressable market] through new product initiatives and deeper penetration into their existing customer base."
- Svanberg adds the Vitesse deal "helps expand [Microsemi's] silicon/dollar content initiatives, especially in the comms infrastructure space and adds differentiated technology with high barriers to entry." He sees the purchase making Microsemi's goal of achieving a 60% gross margin and 30% op. margin in 2016 (compares with 56.2% and 24.4% in calendar Q4) easier to attain.
Tue, Mar. 3, 12:39 PM
- BofA/Merrill's Wamsi Mohan has reinstated coverage on Seagate (STX -5.4%) with an Underperform rating and $50 target, and on Western Digital (WDC -3.3%) with a Neutral rating and $117 target.
- Mohan is worried Q1 and Q2 hard drive demand (i.e. TAM) is tracking below expectations. With regards to Seagate, he's also worried about its relatively high PC exposure (especially for business PCs), SSD cannibalization risk in both the client and (high-margin) performance hard drive segments, and potential conflicts with OEM customers from Seagate's systems business (stems from the Xyratex acquisition).
- Though worried about Western's exposure to the same TAM issues as Seagate, Mohan is relatively positive on the company due to its "solid" SSD position (partly the result of acquisitions) and strength in the growing high-capacity enterprise drive segment (boosted by demand from Internet giants).
- Top hard drive/SSD controller supplier Marvell (MRVL -2.1%) is following Seagate/Western lower, as is hard drive assembly supplier Hutchison (HTCH -1.7%). The Nasdaq is down 0.9%.
- Marvell's decline comes as the company reveals a Release 10 4G modem at the Mobile World Congress (competes with chips from Qualcomm, Intel, and others), as well as a partnership with Google to support the Web giant's Ara modular phone project.
- Earlier: Western Digital buys object storage software firm
Fri, Feb. 20, 9:52 AM
- Deja Vu? Three months ago, Marvell (MRVL +0.9%) rallied after posting an FQ3 revenue miss and light FQ4 guidance. This morning, shares have erased the AH losses they saw on account of an FQ4 revenue miss and soft FQ1 guidance.
- Helping the chipmaker's cause: FBR has upgraded to Outperform, and upped its target by $2 to $21. The firm calls the upgrade a valuation call, and argues core earnings power remains intact.
- Also helping: When asked by JPMorgan's Harlan Sur on the CC (transcript) if Marvell is willing to "explore strategic alternatives" for its mobile chip ops, CEO Sehat Sutardja left the door open to a shakeup. "[A]nything that will bring the share value of a shareholder up is our responsibility to entertain and manage and look at all the different possibilities. But for sure okay we are not backing off from this business."
- The FQ4 revenue miss was blamed on "seasonality and a more aggressive pricing environment" for Marvell's mobile baseband chip business. Companies not named Qualcomm or MediaTek have generally struggled to profit from the R&D-intensive business, which has seen Broadcom, Texas Instruments, and ST-Ericsson leave in recent years.
- Sutardja also admitted the Chinese baseband competitive environment has "intensified" - Qualcomm recently reported something similar. 4G chip sales (+50%) were a strong point.
- Hard drive/SSD controller sales remained fairly healthy, falling 4% Q/Q (in-line with seasonality). Marvell states it gained hard drive controller share in FQ4, and that it remains the SSD controller market's leader following 30% sales growth in FY15 (ended Jan. '15).
Thu, Feb. 19, 4:22 PM
- In addition to missing FQ4 revenue estimates (while slightly beating on EPS), Marvell (NASDAQ:MRVL) is guiding for FQ1 revenue of $810M-$830M and EPS of $0.17-$0.19, below a consensus of $884.2M and $0.22.
- As was the case three months ago, no explanation is given in the earnings release for Marvell's revenue miss or guidance. Deutsche recently argued weak Chinese smartphone baseband chip sales - Marvell faces competition from MediaTek, Qualcomm, and others - would pressure FQ4 results.
- Helping EPS beating estimates: FQ4 gross margin was 51.8%, up from 51% in FQ3 and 50.1% a year ago, and above guidance of 49.5%-51.5%. FQ1 GM guidance is also at 49.5%-51.5%. Also helping: GAAP operating expenses fell 1% Y/Y to $360.5M. Just $20M was spent on buybacks.
- Shares are down to $15.60 AH.
- FQ4 results, PR
Thu, Feb. 19, 4:08 PM
Wed, Feb. 18, 5:35 PM
Thu, Jan. 29, 12:55 PM| Thu, Jan. 29, 12:55 PM | 1 Comment
Thu, Jan. 8, 2:38 PM
- In the wake of a Chinese media report stating a local firm is weighing a bid for Marvell's (NASDAQ:MRVL) mobile chip unit, MKM argues a sale of the business to Intel would be "a solid win-win for both parties."
- MKM asserts buying Marvell would allow Intel to "scale-up in its wireless and foundry businesses," and bolster its chances of succeeding in a very competitive mobile baseband market where Qualcomm/MediaTek still dominate.
- Meanwhile, Marvell could still see earnings grow 10% in spite of the loss of wireless sales (30% of total revenue), thanks to a 40% drop in R&D and sales/marketing spend, and relatively low mobile gross margins (~45%). MKM also believes the deal could dull patent lawsuit fears and allow Marvell to negotiate a favorable foundry deal with Intel.
- One potential roadblock: Intel's deals with Chinese baseband vendors/Marvell rivals Spreadtrum and RDA present a conflict of interest.
- Shares +15% since the Chinese report surfaced on Tuesday. Today's gains are aided by a 3.1% rise for the Philadelphia Semi Index.
Tue, Jan. 6, 12:58 PM
- After previously following the tech sector lower, Marvell (MRVL +3.5%) has popped on a Chinese media report China Electronics is weighing a bid for Marvell's mobile chip ops.
- Marvell's mobile baseband chip unit depends heavily on sales of 3G and 4G phones used on China Mobile's network. The business is believed to have much lower margins than those of Marvell's hard drive/SSD controller and Ethernet IC ops.
- Chipmakers not named Qualcomm, MediaTek, or Spreadtrum have struggled to profit from the baseband market. However, Marvell did state in November it expects strong FY16 (ends Jan. '16) growth for the business thanks to surging Chinese 4G phone sales.
Dec. 30, 2014, 6:05 PM
- French carrier Iliad's (OTC:ILIAF) Online.net unit plans to launch a cloud infrastructure service next month that runs on servers featuring ARM-based (NASDAQ:ARMH) CPUs supplied by Marvell (NASDAQ:MRVL). Making good on ARM's promise of high densities, 18 servers - each sporting one quad-core CPU - can fit onto a blade, and 16 blades can fit within a chassis.
- Though it's no Google or Amazon, Iliad provides a useful reference win for ARM server CPU vendors as they try to take share from Intel (NASDAQ:INTC), whose Xeon CPUs claim the lion's share of the server market, including most Web/cloud data center deployments.
- Canaccord has forecast ARM server CPUs, still in their infancy, will grab a 20% share by 2018. Hyperscale data centers and application-specific server appliances are seen as areas where ARM-based solutions could stand out.
- Intel is looking to head off the ARM threat both by developing low-power Atom server CPUs, maintaining a manufacturing process edge, and (notably) providing a variety of custom CPUs to Internet giants such as Amazon, Google, Facebook, and eBay; the latest offerings are packaged with Altera (NASDAQ:ALTR) FPGAs to provide on-the-fly programmability.
- Nonetheless, Facebook's Open Compute Project supports both ARM and x86 CPUs, and Google has been reported to be thinking of building its own ARM chip. An Amazon VP recently stated ARM vendors aren't keeping pace with Intel. But Amazon might simply be opting to create its own ARM designs, given it has hired several key engineers from defunct ARM vendor Calxeda.
- Cavium (NASDAQ:CAVM) and AppliedMicro (NASDAQ:AMCC) are often viewed as ARM server CPU plays. AMD, Qualcomm, and Texas Instruments are also competing in this space.
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