Wedbush Remains Optimistic on Cypress Semiconductor Corporation Following Agreement to Divest TrueTouch Mobile to Parade
Wedbush analyst Betsy Van Hees weighed in today with a favorable report on Cypress Semiconductor Corporation (NASDAQ:CY) after the company signed a definitive agreement to divest its TrueTouch Mobile touch business to Parade for $100MM in cash. The analyst reiterated an Outperform rating on the stock with a price target of $17. Shares of CY are currently trading at $12.98, down $0.16, or -1.22%.
Hees noted, “The ball is once again back in CY’s court. We reiterate our view that the proposed tuck-in acquisition of ISSI will be immediately accretive but given the back and forth, timing will likely be pushed out and lower our assumptions to $0.10 to $0.20 in 2016 from $0.20 to $0.30. We also reiterate our belief that CY has considerable cost synergies above the $160MM annually by Q4:17 from CODE driving meaningful operating leverage on at worst a flat $2B in revenue.”
Furthermore, “We believe this is supported by CY’s divestiture of the TrueTouch Mobile business. We look for CY to continue to evaluate its core combined business with CODE and likely divest/wind down other less attractive segments to drive improvement to the bottom-line.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Betsy Van Hees has a total average return of 19.2% and a 55.8% success rate. Hees has a -4.6% average return when recommending CY, and is ranked #234 out of 3621 analysts.
Out of the 10 analysts polled by TipRanks, 7 rate Cypress Semiconductor stock a Buy, 2 rate the stock a Hold, and 1 recommends a Sell. With a return potential of 25.5%, the stock’s consensus target price stands at $16.30.