Silicon Labs Executing On Its IoT Opportunity, With Infrastructure Likely To Get Better In 2020

About: Silicon Laboratories Inc. (SLAB)
by: Stephen Simpson, CFA
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Stephen Simpson, CFA
Long only, growth at reasonable price, value, research analyst

IoT continues to drive Silicon Labs' growth, and particularly its strong wireless portfolio, which saw better than 20% growth in the third quarter.

Infrastructure is being held back by weakness in the timing business, but the isolation business is doing well and Silicon Labs has attractive long-term opportunities in 5G and auto timing.

Silicon Labs shares still seem to be embedding a takeover premium in the valuation, as the shares have outpaced what the company's growth and margins could otherwise seem to support.

Maybe valuation does matter, at least a little. When I last wrote about Silicon Labs (SLAB) I wrote that I’d at least somewhat thrown in the towel on valuation where this stock was