In a research report sent to investors today, FBR analyst Christopher Rolland reiterated an Outperform rating on NXP Semiconductors (NASDAQ:NXPI) with a $95 price target, as the company reported better-than-expected top line 4Q14 results and 1Q15 guidance.
Rolland observed, “Indeed, 4Q14 results beat by 110 bps versus just 30 bps for the industry. Additionally, our new 1Q15 EPS estimate is 7% higher than prior, driving line of sight into $7.00 of pro forma EPS in 2016. If we were to nitpick, gross margins were slightly worse than expected in 4Q14 but appear to get back on track in 1Q15. Over the last half decade, NXP has significantly de-leveraged, achieving a comfortable level of debt with a manageable interest burden, in our opinion.”
The analyst added, “Meanwhile, NXP’s business has improved as the company has consolidated its position in fast-growing end markets, namely identification and automotive. The result is a growing company with an improved balance sheet generating substantial cash used for aggressive share repurchases.”
NXP Semiconductors N.V. provides high performance mixed signal and standard product solutions for radio frequency (RF), analog, power management, interface, security, and digital processing products worldwide.