There’s a lot to be optimistic about in the Consumer Goods sector as 2 analysts just weighed in on Maxlinear Inc (MXL) and Skyworks Solutions (SWKS) with bullish sentiments.
Maxlinear Inc (MXL)
In a report released today, Quinn Bolton from Needham assigned a Buy rating to Maxlinear Inc, with a price target of $24. The company’s shares closed yesterday at $19.74.
Bolton noted:
“MXL reported solid 4Q18 results and issued 1Q19 revenue guidance in-line with our revised estimates following CES. Connected Home grew ~3% and is expected to grow slightly Q/Q despite tariff effects and supply chain shifts mitigating the recovery. 4Q18, is expected to decline Q/Q due to seasonality and the strong 4Q18 performance. Ind&Multi-Markets declined 6% driven by the industry slowdown and is expected to decline Q/Q in 1Q19 due to continuing macro pressures. We are buyers of MXL shares given the stabilization in Connected Home, continued progress in Infrastructure programs and improving operating leverage reflecting a significant reduction in 2019 OpEx. We increase our PT to $24 from $20, based 16x our 2020 NG EPS estimate to reflect our increased confidence.”
According to TipRanks.com, Bolton is a 5-star analyst with an average return of 13.5% and a 63.0% success rate. Bolton covers the Consumer Goods sector, focusing on stocks such as MACOM Technology Solutions Holdings Inc, Sequans Communications S A, and Quantenna Communications.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Maxlinear Inc with a $21.67 average price target, which is a 9.8% upside from current levels. In a report issued on January 31, Stifel Nicolaus also reiterated a Buy rating on the stock with a $23 price target.
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Skyworks Solutions (SWKS)
Needham analyst Rajvindra Gill maintained a Buy rating on Skyworks Solutions today and set a price target of $95. The company’s shares closed yesterday at $75.96.
Gill said:
“We are increasing our PT to $95 (vs. $77) following a solid quarter and guide in light of the Apple and China handset weakness. We anticipate a rebuild in orders starting in June and then continuing into the September and December quarters, principally driven off a low-base at Korean OEMs. Moreover, with the broad markets segment expected to grow double digits Y/Y and account for +30% of sales end of FY19, we expect gross margins to expand gradually throughout the year. Our just-raised $95 PT is 12x our FY20 NG EPS estimate of $7.65 plus net cash. We are applying a higher P/E multiple (10x was previous) as we are reaching the trough in Apple segments in June; also we look for broad markets, which carry higher gross margins, to account for a higher percentage of sales.”
According to TipRanks.com, Gill is a 5-star analyst with an average return of 11.2% and a 54.7% success rate. Gill covers the Consumer Goods sector, focusing on stocks such as Everspin Technologies Inc, Smart Global Holdings Inc, and Adesto Technologies Corp.
Skyworks Solutions has an analyst consensus of Moderate Buy, with a price target consensus of $86.11, which is a 13.4% upside from current levels. In a report issued on January 28, B.Riley FBR also upgraded the stock to Buy with a $90 price target.
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