NXP Semi Remains Deutsche Bank's Top Pick, Sees Self-Help Story As 'Compelling'

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Deutsche Bank analyst Ross Seymore issued a note on shares of NXP Semiconductors NV NXPI. Monday's note followed recent investor meetings with company CFO Dan Durn and VP of Investor Relations Jeff Palmer.

Seymore highlighted four key findings from the meetings.

  • Macro remains mediocre, but NXPI focus is on content/share gains.
  • Margins rising, with SP sale accelerating the pace.
  • Balanced cash returns to accelerate as well.
  • PE ownership an overhang, but with diminishing impact.

"In an otherwise mediocre environment for semis, we continue to see upside in NXPI shares as its content-driven revenue growth, organic/synergy-based margin expansion and significant cash return capability should combine to meaningfully reduce the significant valuation discount vs. similar high quality peers," Seymore said.

The analyst reiterated a Buy rating and $110 price target on shares.

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Posted In: Analyst ColorReiterationAnalyst RatingsDeutsche BankRoss Seymore
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