Qorvo Wins A New Bullish Analyst: Charter Equity Upgrades To Buy

Although Qorvo Inc QRVO was plagued with execution problems through 2016, investors seem to have “digested all the bad news” and the company is poised for “strong secular growth ahead,” Charter Equity’s Edward Snyder said in a report.

Snyder upgraded the rating on the company from Market Perform to Buy, saying Qorvo will likely achieve better-than-expected growth going ahead.

Spur In Demand

“Technical discussions at MWC [Mobile World Congress] increased our confidence that spending on RF [radio frequency] components is running ahead of expectations and that more of it is increasingly being directed at Qorvo,” Snyder wrote.

The rising demand trends being witnessed by the company will enable it to achieve robust topline growth over the next several years.

Related Link: Qorvo Analyst Throws In The Towel On Positive View, Downgrades Stock

While investors were focusing on execution issues at Qorvo, which exerted pressure on shares, the company’s top-line performance has been “tangible evidence of acceleration in RF spending and higher concentration of that spending on fewer suppliers,” the analyst noted. The company’s results in the previous quarter suggest that the execution issues have been largely resolved.

With execution issues now behind Qorvo, margin pressure would ease and the company would be able to converting more of its revenue to EPS, Snyder commented.