It has been an interesting twelve months for Nordic Semiconductor (OTCPK:NDCVF) (NOD.OL), a small Norway-based fabless semiconductor company focused on low-power wireless chip solutions.
During 2016, Nordic Semi had a poor run of quarterly results and saw a peak-to-trough run from the spring of 2016 to the spring of this year that took about 40% off the share price as investors worried about market share losses to rivals like Texas Instruments (TXN) and concerns about whether this small company with a relatively limited line-up could continue to compete effectively with larger players like TI, Dialog (DLGNF), Qualcomm (QCOM), Microchip (MCHP), Silicon Labs (SLAB), and the many other plays in low-power wireless.
The last two quarters have been stronger, though, and the shares have regained a fair bit of the ground lost in 2016 and early 2017. While wearables and consumer electronics remain tough markets, the company is seeing strong growth in its building/retail business and will be sampling its new low-power cellular IoT chips before the end of the year.
Nordic Semi doesn't look especially cheap on the fundamentals, but that's often the case with growth tech stocks; if Nordic can deliver high-teens growth for a few years and keep its margins up, the shares should continue to rise. That said, investors should note that the U.S.-listed ADRs are not very liquid; investors who can trade on foreign exchanges will find better liquidity on Nordic Semi's home market.
An IoT Facilitator
The entire Internet of Things (or IoT) concept pretty much rests on the idea of communication and connectivity – allowing devices to communicate with each other over networks where they previously couldn't. With that, companies can track the flow of products through their factories and distribution channels, consumers can have household devices that communicate with each other, and so on.
