Renesas Electronics Stock (OTC:RNECF), Trade Ideas

Renesas Electronics Corp is a Japan-based company that manufactures and distributes semiconductor components and other products for use in automotive, healthcare, computer peripheral, connectivity, home appliance, and industrial end markets. Its product portfolio includes microcontrollers and microprocessors, embedded systems platform, insulated-gate bipolar transistors, intelligent power devices, thrysistors, transistors, diodes, analog integrated circuits, and optoelectronics products. The firm has operations in Japan, the Americas, Europe, Middle East and Africa, and Asia.

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Renesas will acquire all outstanding shares of Transphorm&#39;s common stock for $5.10 per share in cash, representing a premium of 35% to closing price on January 10, 2024.

Why Semiconductor Company Transphorm Shares Are Rocketing Today

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To gain an edge, this is what you need to know today.

Pay Attention To Very Positive Positioning, Critical Metals And Cloud Computing Restrictions

RENESAS ELECTRONICS CORP by Renesas Electronics Corp

Renesas Electronics Corp

Transphorm Inc&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TGAN#NASDAQ">TGAN</a>) shares are zooming by around 30% after it disclosed its acquisition by&nbsp;Renesas Electronics Corp&nbsp;(OTC:<a class="ticker" href="https://www.benzinga.com/stock/RNECF#OTC">RNECF</a>)&nbsp;<a target="_blank" href="https://www.benzinga.com/pressreleases/24/01/b36588348/renesas-to-acquire-transphorm-to-expand-its-power-portfolio-with-gan-technology" rel="noreferrer noopener">for about $339 million</a>.
As per the deal, Renesas will acquire TGAN for $5.10 per share in cash, reflecting a premium of around 35% to its closing price on January 10, 2024, a premium of approximately 56% to the volume-weighted average price over the last twelve months and a premium of roughly 78% to the volume weighted average price in the previous six months.&nbsp;
TGAN&#8217;s board of directors has unanimously approved the acquisition deal concerning the transaction and recommended that its stockholders adopt such a definitive agreement and approve the merger.&nbsp;
Concurrently with the execution of the deal, KKR Phorm Investors L.P., which holds approximately 38.6% of TGAN&#8217;s shares, has entered into a customary voting agreement with Renesas to vote in favor of the transaction.
The transaction is expected to close in H2 of 2024, subject to shareholders&#8217; approval, required regulatory clearances, and the satisfaction of other customary closing conditions.
Hidetoshi Shibata, CEO of Renesas, said, &#8220;The addition of Transphorm&#8217;s GaN technology builds on our momentum in IGBT and SiC. It will fuel and expand our power portfolio as a key pillar of growth, offering our customers the full ability to choose their optimal power solutions.&#8221;
Primit Parikh, Co-founder, President and CEO of Transphorm and Umesh Mishra, Co-founder and CTO of Transphorm, said, &#8220;This transaction will also allow us to offer further expanded services to our customers and deliver significant immediate cash value to our stockholders. Additionally, it will provide a strong platform for our exceptional team to further Transphorm&#8217;s leading GaN technology and products.&#8221;
Price Action: TGAN shares are up 30.34% at $4.94 premarket on the last check Thursday.

Bank of America has highlighted five global stocks poised to profit as the application of artificial intelligence (AI) continues to burgeon. The bank projects significant growth potential for &#8220;end-device AI,&#8221; a deviation from the current server-based systems.
As per a&nbsp;CNBC&nbsp;<a href="https://www.cnbc.com/2023/10/11/bank-of-america-these-6-global-ai-stocks-are-hidden-gems-with-great-potential.html">report</a>, the bank made these predictions in&nbsp;a recent note titled&nbsp;&#8220;End-device&nbsp;AI: Great potential with hidden&nbsp;gems awaits.&#8221; It anticipates that&nbsp;customized and private AI services&nbsp;could be delivered directly to users&#8217; end devices, transforming smartphones, tablets, cars, and more.
The BofA analysts, led by Brad Lin, compared &#8220;end-device AI&#8221; to&nbsp;the AI assistant used by&nbsp;&#8220;Iron Man,&#8221; J.A.R.V.I.S. They forecast&nbsp;a 96% compounded annual growth&nbsp;rate for foundries and a&nbsp;105% growth rate for chipmakers&nbsp;from 2023-2025, reaching over $14&nbsp;billion in revenue.
See Also:&nbsp;<a href="https://www.benzinga.com/markets/equities/23/10/35136955/walgreens-reportedly-confronts-impending-staff-walkout-is-your-local-pharmacy-shutting-down-next?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Walgreens Reportedly Confronts Impending Staff Walkout — Is Your Local Pharmacy Shutting Down Next Week?</a>
According to the note, &#8220;We&nbsp;expect more generative AI-ready chip&nbsp;launches in late 2023 and new&nbsp;end-product announcements during CES and&nbsp;MWC in early 2024 to&nbsp;be key catalysts.&#8221;
The report listed&nbsp;Qualcomm Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QCOM#NASDAQ">QCOM</a>),&nbsp;MediaTek Inc. (OTC:<a class="ticker" href="https://www.benzinga.com/stock/MDTKF#OTC">MDTKF</a>),&nbsp;Nordic Semiconductor (OTC:<a class="ticker" href="https://www.benzinga.com/stock/NDCVF#OTC">NDCVF</a>),&nbsp;SK Hynix Inc. (OTC:<a class="ticker" href="https://www.benzinga.com/stock/HXSCL#OTC">HXSCL</a>), and&nbsp;Renesas Electronics Corporation (OTC:<a class="ticker" href="https://www.benzinga.com/stock/RNECF#OTC">RNECF</a>)&nbsp;as major potential beneficiaries.
Bank of America predicts that automakers will leverage&nbsp;advanced end-device AI capabilities from&nbsp;Qualcomm&#8217;s&nbsp;Ride platform for in-car services.&nbsp;Similarly, it expects MediaTek to implement generative AI functions into its upcoming flagship smartphone chips.
Read Next:&nbsp;<a href="https://www.benzinga.com/markets/cryptocurrency/23/10/35139582/dogecoin-co-creator-elon-musk-blast-sec-for-denying-inherent-value-of-cryptos-return-all-t?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Dogecoin Co-Creator, Elon Musk Blast SEC For Denying Inherent Value Of Cryptos: &#8216;Return All The Taxes…You Renesas Electronics Corporation</a>
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The&nbsp;two companies have entered into a memorandum of understanding (the &quot;MoU&quot;). Pursuant to the terms of the MoU, Renesas will, following consultation of the Sequans&#39; works council and favorable recommendation by the Sequans Board, commence a tender offer to acquire all outstanding ordinary shares, including American Depositary Shares (ADS) of Sequans for&nbsp;$3.03&nbsp;per ADS (each ADS representing four ordinary shares) in cash. The transaction values Sequans at approximately&nbsp;$249 million, including net debt, and is expected to close by the&nbsp;first quarter&nbsp;of calendar year 2024, subject to confirmation of tax treatment from relevant authorities, regulatory approvals and other customary closing conditions.

RNECY

SQNS

Renesas Electronics To Acquire Sequans Communications For ~$249M

To gain an edge, this is what you need to know today.
<h3>Very Positive Positioning</h3>
Please&nbsp;<a href="https://thearorareport.com/stock-market-chart-analysis-semiconductor-etf-china-ai-smh-mc-07052023">click here</a>&nbsp;for a chart of semiconductor VanEck Semiconductor ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/smh#NASDAQ">SMH</a>).
Note the following:
<ul>
<li>The chart is a weekly chart to give you a longer term perspective.</li>
<li>Semiconductors are the leading sector as we have previously written.&nbsp; Semiconductors have also been a prime beneficiary of the artificial intelligence (AI) frenzy.&nbsp;For the direction of the stock market, investors should pay attention to the semiconductor sector in addition to the group of magnificent seven stocks Apple Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>), Amazon.com&nbsp;Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/amzn#NASDAQ">AMZN</a>), Alphabet Inc Class C&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/goog#NASDAQ">GOOG</a>), Meta Platforms Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/meta#NASDAQ">META</a>), Microsoft Corp (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>), NVIDIA Corp (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/nvda#NASDAQ">NVDA</a>), and Tesla Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tsla#NASDAQ">TSLA</a>).</li>
<li>The chart shows the move up in semiconductors when Nvidia projected $11B in revenues vs. about $7B consensus.</li>
<li>The chart shows that semiconductors are consolidating in a range.&nbsp;Investors should look for a breakout or a breakdown from a consolidation range for the market direction.</li>
<li>RSI on the chart shows that on a weekly basis semiconductors are overbought.&nbsp;When a sector is overbought, it is vulnerable to pullbacks.&nbsp;However, there is a special factor of the&nbsp;AI&nbsp;frenzy.&nbsp;Due to&nbsp;AI&nbsp;frenzy, pullbacks will likely be shallow and buying opportunities.</li>
<li>Investors should pay attention to positioning.&nbsp;Positioning in semiconductors is now extremely positive. Positioning in the overall stock market is now very positive. Positioning is a very important Wall Street mechanic that all investors should strive to develop a deep understanding of as it can give you a big edge.&nbsp; For those wanting a deep understanding of positioning, listen to the podcast &ldquo;Market Mechanics: Positioning.&rdquo;</li>
<li>The general rule from a long term perspective is to buy new positions,&nbsp;add&nbsp;to positions, and start trade around positions when positioning is very negative to extremely negative and to take profits on tactical positions and initiate short positions when positioning is very positive to extremely positive.</li>
<li>The news from China is that China is restricting the export of gallium, germanium, and other related materials.&nbsp;These metals are critical for certain semiconductor, electric vehicle, solar, defense, and automotive applications.</li>
<li>Between 2018 - 2021, 53% of the gallium used in the&nbsp;U.S. was imported from China.&nbsp;In 2019, the&nbsp;U.S. increased tariffs on Chinese gallium, reducing imports.&nbsp;However, these numbers are deceptive in that these materials are often exported from China to other Asian countries such as Taiwan, Japan, South Korea, and Thailand, and then finished products are imported to the U.S.</li>
<li>Stocks of Chinese gallium and germanium companies are jumping as much as 10%.&nbsp;In theory, stocks of such companies should go down because they will have more restrictions on exports and lower revenues.&nbsp; In practice, these companies may be able to smuggle their goods outside China and, in the process, charge higher prices.&nbsp;&nbsp;</li>
<li>Among the&nbsp;U.S. semiconductor companies, there may be a negative impact on Skyworks Solutions Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/swks#NASDAQ">SWKS</a>), Qorvo Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qrvo#NASDAQ">QRVO</a>), and Wolfspeed Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/wolf#NASDAQ">WOLF</a>).</li>
<li>In separate news, Japanese company Renesas Electronics Corp (OTC: <a class="ticker" href="https://www.benzinga.com/stock/rnecf#OTC">RNECF</a>), headquartered in Tokyo, is providing a $2B deposit to Wolfspeed for a 10 year silicon carbide supply agreement.&nbsp; Silicon carbide power devices are playing an increasing role in electric vehicles and renewable energy.&nbsp; For this reason, Wolfspeed stock is jumping in spite of the China news.</li>
<li>Until now, it has been easy for Chinese companies to circumvent&nbsp;U.S. restrictions on the export of advanced Nvidia chips to China.&nbsp; The&nbsp;U.S. has imposed its restrictions to slow down the development of artificial intelligence in China. Chinese companies have been able to get around these restrictions by simply using the cloud capacity of Microsoft and Amazon.&nbsp; Now, the U.S. is planning to restrict U.S. cloud companies from providing certain cloud infrastructure to Chinese companies.&nbsp; This is negative for Microsoft, Amazon, and Nvidia.</li>
<li>Prudent investors are paying attention that worsening relations between the&nbsp;U.S. and China on technology pose a serious risk not only to the companies named above but pose a more serious risk to companies deriving significant revenue from China such as Apple and Tesla.&nbsp; The momo crowd is oblivious and continues to aggressively buy Apple and Tesla stocks.</li>
<li>Secretary of the Treasury Janet Yellen is starting her visit to China in an attempt to thaw relations.</li>
<li>In The Arora Report analysis, Yellen&rsquo;s trip to China will likely be showcased as a success by both the&nbsp;U.S. and China.&nbsp; However, nothing is going to change in the longer term geopolitics as China remains determined to dethrone the&nbsp;U.S. as the number one super power.&nbsp;</li>
<li>As we have written before, July is a seasonally positive month for the stock market.</li>
<li>As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents.</li>
</ul>
<h3>Blind Money</h3>
Blind money is the money that pours into Wall Street at the beginning of the month without any analysis.&nbsp; This month, due to the holiday, blind money will be invested mostly in the afternoon today and tomorrow.
<h3>China PMI</h3>
The latest PMI numbers from China show that recovery is not taking hold.&nbsp; Caixin Services PMI came at 53.9 vs. 57.1 prior.&nbsp; Caixin Manufacturing PMI came 50.5 vs. 50.9 prior.
<h3>Momo Crowd And Smart Money In Stocks</h3>
The momo crowd is buying stocks in the early trade.&nbsp; Smart money is lightly selling stocks in the early trade.
<h3>Gold</h3>
The momo crowd is buying gold in the early trade.&nbsp; Smart money is inactive in the early trade.
For longer-term, please see gold and silver ratings.
<h3>Oil</h3>
Oil is giving back its gains on the news of output cuts by Saudi Arabia.&nbsp; In The Arora Report analysis, the reason Saudi production cuts are not succeeding in running up oil is the relationship between Russia and India as well as Russia and China.&nbsp;
The momo crowd is like a yoyo in oil in the early trade.&nbsp; Smart money is inactive in the early trade.
For longer-term, please see oil ratings.
<h3>Bitcoin</h3>
Bitcoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/btc/usd">BTC</a>) is range bound.
<h3>Markets</h3>
Our very, very short-term early stock market indicator is negative.&nbsp; This indicator, with a great track record, is popular among long term investors to stay in tune with the market and among short term traders to independently undertake quick trades.
<h3>Protection Band And What To Do Now</h3>
It is important for investors to look ahead and not in the rearview mirror.
Consider continuing to hold good, very long term, existing positions. Based on individual risk preference, consider holding 21% - 39% in cash or Treasury bills or allocated to short-term tactical trades; and short to medium-term hedges of 3% - 6%, and short term hedges of 5% - 8%. This is a good way to protect yourself and participate in the upside at the same time.
You can determine your protection bands by adding cash to hedges.&nbsp; The high band of the protection is appropriate for those who are older or conservative. The low band of the protection is appropriate for those who are younger or aggressive.&nbsp; If you do not hedge, the total cash level should be more than stated above but significantly less than cash plus hedges.
It is worth reminding that you cannot take advantage of new upcoming opportunities if you are not holding enough cash.&nbsp;&nbsp;When adjusting hedge levels, consider adjusting partial stop quantities for stock positions (non ETF); consider using wider stops on remaining quantities and also allowing more room for high beta stocks.&nbsp; High beta stocks are the ones that move more than the market.
<h3>Traditional 60/40 Portfolio</h3>
Probability based risk reward adjusted for inflation does not favor long duration strategic bond allocation at this time.
Those who want to stick to traditional 60% allocation to stocks and 40% to bonds may consider focusing on only high quality bonds and bonds of five year duration or less.&nbsp; Those willing to bring sophistication to their investing may consider using bond ETFs as tactical positions and not strategic positions at this time.
The Arora Report is known for its accurate calls.&nbsp; The Arora Report correctly called the 2008 financial crash, the start of a mega bull market in 2009, the COVID crash, the post-COVID bull market, and the 2022 bear market.&nbsp; Please click here to sign up for a free forever <a href="https://thearorareport.com/generate-wealth-newsletter">Generate Wealth Newsletter</a>.

Wolfspeed Inc&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wolf#NYSE">WOLF</a>) shares are trading higher by around 15% after it disclosed a 10-year silicon carbide wafer supply deal with Renesas Electronics Corporation (OTC: <a class="ticker" href="https://www.benzinga.com/stock/rnecy#OTC">RNECY</a>) (OTC: <a class="ticker" href="https://www.benzinga.com/stock/rnecf#OTC">RNECF</a>).
As per the agreement, Wolfspeed will supply high-quality 150mm silicon carbide bare and epitaxial wafers to Renesas, accelerating Renesas&#39; silicon carbide power semiconductors&#39;&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/pressreleases/23/07/b33111628/renesas-and-wolfspeed-sign-10-year-silicon-carbide-wafer-supply-agreement" style="background-image:initial; background-position:initial; background-size:initial; background-repeat:initial; background-attachment:initial; background-origin:initial; background-clip:initial; margin-top:0pt; margin-bottom:0pt; color:#4a6ee0" target="_blank">production that will begin in 2025.</a>
The deal also includes a $2 billion deposit by Renesas and will support the adoption of silicon carbide across automotive, industrial, and energy markets.&nbsp;
Renesas&#39; deposit amount is expected to aid Wolfspeed&#39;s ongoing capacity construction projects, such as creating the world&#39;s largest silicon carbide materials factory in North Carolina.&nbsp;
The facility is expected to boost Wolfspeed&#39;s current silicon carbide production capacity in Durham by over 10-fold and generate mainly 200mm silicon carbide wafers.
&quot;With the steepening demand for silicon carbide across the automotive, industrial and energy sectors, it&#39;s critically important we have best-in-class power semiconductor customers like Renesas to help lead the global transition from silicon to silicon carbide. For more than 35 years, Wolfspeed has focused on producing silicon carbide wafers and high-quality power devices, and this relationship marks an important step in our mission to save the world energy,&quot; said Gregg Lowe, President and CEO.&nbsp;
Last month, Wolfspeed received $1.25 billion in&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/23/06/33004434/why-wolfspeed-stock-is-moving-higher-monday" style="background-image:initial; background-position:initial; background-size:initial; background-repeat:initial; background-attachment:initial; background-origin:initial; background-clip:initial; margin-top:0pt; margin-bottom:0pt; color:#4a6ee0" target="_blank">secured note financing</a>&nbsp;from an investment group led by&nbsp;Apollo Global Management Inc&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/apo#NYSE">APO</a>).
Price Action: WOLF shares are up 14.7% at $65.10 premarket on the last check Wednesday.

Mid Cap

Contracts

Why Wolfspeed Shares Are Popping Today

Renesas&nbsp;announced the execution of a wafer supply agreement and&nbsp;$2 billion deposit by Renesas to secure a 10 year supply commitment of silicon carbide bare and epitaxial wafers from Wolfspeed. The supply of high-quality silicon carbide wafers from Wolfspeed will pave the way for Renesas to scale production of silicon carbide power semiconductors starting in 2025.&nbsp;The Renesas&nbsp;$2 billion&nbsp;deposit will help support Wolfspeed&#39;s ongoing capacity construction projects

Renesas, Wolfspeed Ink 10 Year Silicon Carbide Wafer Supply Agreement

<ul>
<li>Taiwan Semiconductor Manufacturing Co Ltd&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/tsm#NYSE">TSM</a>) saw orders for automotive electronics chips accelerating at a faster-than-expected pace,&nbsp;<a class="editor-rtfLink" href="https://www.digitimes.com/news/a20220322PD209.html" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Digi Times reports</a>.</li>
<li>TSMC&#39;s advanced technology leadership&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/02/25748734/tsmc-wins-7nm-chip-orders-from-us-vendors" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">will likely attract</a>&nbsp;an influx of AI chip orders for autonomous driving from vendors including&nbsp;NVIDIA Corp&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/nvda#NASDAQ">NVDA</a>),&nbsp;Qualcomm Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qcom#NASDAQ">QCOM</a>),&nbsp;Intel Corp&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/intc#NASDAQ">INTC</a>), and&nbsp;Tesla Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tsla#NASDAQ">TSLA</a>).&nbsp;</li>
<li>TSMC commanded a more than 90% share of the 7/5nm foundry process segment.</li>
<li>TSMC was also the largest beneficiary of IDMs stepping up their outsourcing of automotive MCUs and other chips to pure-play foundries.&nbsp;</li>
<li>TSMC had already won 70% of the total automotive chip orders placed by IDMs.</li>
<li>IDMs including&nbsp;Infineon Technologies AG&nbsp;(OTC: <a class="ticker" href="https://www.benzinga.com/stock/ifnnf#OTC">IFNNF</a>),&nbsp;NXP Semiconductors NV&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/nxpi#NASDAQ">NXPI</a>),&nbsp;STMicroelectronics NV&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/stm#NYSE">STM</a>),&nbsp;Texas Instruments Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/txn#NASDAQ">TXN</a>), and&nbsp;Renesas Electronics Corp&nbsp;(OTC: <a class="ticker" href="https://www.benzinga.com/stock/rnecf#OTC">RNECF</a>) have outsourced 15% of automotive chip production. The proportion is poised to grow.</li>
<li>TSMC&nbsp;<a class="editor-rtfLink" href="https://m.benzinga.com/article/23986857" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">was building new</a>&nbsp;28nm process fabrication lines at its 12-inch fab in Nanjing.&nbsp;</li>
<li>TSMC and Sony&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/10/23295315/sony-plans-to-invest-in-apple-suppliers-japanese-chip-plant-nikkei-asia" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">set up a joint-venture</a>&nbsp;fab Japan Advanced Semiconductor Manufacturing for 22nm and 28nm process manufacturing in Kumamoto, Japan&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/22/02/25635955/tsmc-looks-to-expand-japan-chip-plant-denso-acquires-stake" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">attracting</a>&nbsp;Denso&#39;s participation.</li>
<li>Price Action:&nbsp;TSM shares traded lower by 0.21% at $107.14 on the last check Tuesday.</li>
</ul>

IFNNF

INTC

NXPI

TSMC Sees Demand Spike For Auto Chips Thanks To Tesla, Nvidia, Qualcomm, Intel

<ul>
<li><a class="editor-rtfLink" href="https://www.reuters.com/technology/synopsys-design-software-uses-ai-make-chips-more-power-efficient-2021-08-23/" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Reuters reports that</a>&nbsp;one of&nbsp;Synopsys Inc&#39;s&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/snps#NASDAQ">SNPS</a>) customers has resorted to artificial intelligence software to increase chip power efficiency by 26%.&nbsp;</li>
<li>Synopsys has started weaving AI called DSO.ai into its flagship chip design suite.&nbsp;</li>
<li>Samsung Electronics Co Ltd&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/ssnlf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">SSNLF</a>) and&nbsp;&nbsp;Renesas Electronics Corp&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/rnecf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">RNECF</a>) (OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/rnecy#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">RNECY</a>) have begun using the chip.</li>
<li>The chip can work wonders amid the&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/05/20910013/intel-tsm-anticipate-semiconductor-crisis-to-extend-beyond-2021-bloomberg" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">present global chip</a>&nbsp;crisis by easing pressure on the chipmakers.</li>
<li>Previously,&nbsp;Alphabet Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/goog#NASDAQ">GOOG</a>) (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/googl#NASDAQ">GOOGL</a>)&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/06/21514720/google-claims-its-ai-can-beat-human-chip-building-speed-cnbc" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">claimed to have</a>&nbsp;developed AI software for faster computer chip designing than humans.</li>
<li>Also,&nbsp;International Business Machines Corp&nbsp;(NYSE: <a class="ticker" href="https://www.benzinga.com/stock/ibm#NYSE">IBM</a>) just&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/pressreleases/21/08/n22609670/ibm-unveils-on-chip-accelerated-artificial-intelligence-processor" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">revealed the impending</a>&nbsp;<a class="editor-rtfLink" href="https://c212.net/c/link/?t=0&amp;l=en&amp;o=3266338-1&amp;h=1307444742&amp;u=http%3A%2F%2Fwww.ibm.com%2Fblogs%2Fsystems%2Fibm-telum-processor-the-next-gen-microprocessor-for-ibm-z-and-ibm-linuxone%2F&amp;a=IBM+Telum+Processor" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">IBM Telum Processor</a>&nbsp;developed in 7nm EUV technology node containing on-chip acceleration for AI inferencing while a transaction occurs.</li>
<li>IBM&#39;s chip contains eight processor cores with a deep superscalar out-of-order instruction pipeline, running with over 5GHz clock frequency.</li>
<li>The features render the processor ideal for financial services workloads like fraud detection, loan processing, clearing and settlement of trades, anti-money laundering, and risk analysis.</li>
<li>Canaan Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/can#NASDAQ">CAN</a>)&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/07/21892475/canaan-introduces-self-developed-edge-ai-chip-the-kendryte-k510" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">had also disclosed</a>&nbsp;about its self-developed AI chip.</li>
<li>Recently&nbsp;Baidu Inc&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/bidu#NASDAQ">BIDU</a>)&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/08/22551178/baidu-plans-future-in-ai-and-autonomous-driving" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">announced the mass</a>&nbsp;production of its second-generation 7 nm AI chip Kunlun 2.</li>
<li>Price Action:&nbsp;SNPS traded higher by 1.03% at $320.15 on the last check Monday.</li>
</ul>

BIDU

GOOGL

SNPS

SSNLF

How Chip Developers Are Using AI To Make Chips More Efficient?

<ul>
<li>The Japanese automaker,&nbsp;Mitsubishi Motors Corp&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/mmtof#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">MMTOF</a>) (OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/mmtoy#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">MMTOY</a>), will reduce global production by roughly 16,000 cars in May due to the semiconductor chip crisis,&nbsp;<a class="editor-rtfLink" href="https://www.bloomberg.com/news/articles/2021-04-23/mitsubishi-to-cut-16-000-units-globally-in-may-on-chip-shortage?sref=TBDibEcD" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Bloomberg reports</a>.</li>
<li>In March, Mitsubishi aimed to reduce the domestic vehicle output by 4,000 to 5,000 units at its Okazaki and Mizushima plants due to the crisis. The automaker was reviewing its production plans for April at that time.</li>
<li>Mitsubishi produced 90,745 units globally in January and 88,754 cars in February.</li>
<li>The semiconductor crisis was intensified by the Texas winter storm and fire at auto-chip maker&nbsp;Renesas Electronics Corp&rsquo;s&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/rnecf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">RNECF</a>) Japanese chip plant and could&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/03/20427975/global-chip-crisis-estimated-to-jeopardize-1-3m-vehicle-production-bloomberg" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">jeopardize the production</a>&nbsp;of 1.3 million vehicles. Major&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/04/20543752/general-motors-extend-production-holidays-to-counter-global-semiconductor-crunch-cnbc" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">automakers</a>, including&nbsp;General Motors Co&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/gm#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">GM</a>) and&nbsp;Ford Motor Co&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/f#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">F</a>),&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/04/20740283/chip-shortage-prolongs-ford-production-halt-at-5-north-american-factories" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">have extended</a>&nbsp;production cuts.</li>
<li>Price action:&nbsp;MMTOF shares closed higher by 0.75% at $2.67 on Thursday.</li>
</ul>

Penny Stocks

MMTOF

MMTOY

Mitsubishi To Cut Global Production By 16,000 Units For May To Counter Chip Crisis: Bloomberg

<ul>
<li>Taiwan&rsquo;s severe drought could aggravate the ongoing global chip crisis as semiconductor producers required a massive water supply to clean the wafer base, etch patterns, polish layers and rinse components throughout the manufacturing process, the&nbsp;<a class="editor-rtfLink" href="https://www.wsj.com/articles/the-chip-shortage-is-bad-taiwans-drought-threatens-to-make-it-worse-11618565400?mod=tech_lead_pos1" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Wall Street Journal reports</a>.</li>
<li>Taiwan&rsquo;s semiconductor wafer-fabrication factories (fabs) accounted for two-thirds of the global manufacturing capacity. Most of that capacity belonged to contract chip manufacturer&nbsp;Taiwan Semiconductor Manufacturing Co Ltd&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/tsm#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">TSM</a>).</li>
<li>Taiwan derived most of its water reserves from seasonal typhoons. However, a lack of storms last year had choked supplies, prompting the government to start water rationing for over a million businesses and residents.</li>
<li>Samsung Electronics Co Ltd&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/ssnlf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">SSNLF</a>) had to&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/03/20398784/samsungs-austin-chip-production-back-near-normalcy-levels-reuters" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">temporarily shut down</a>&nbsp;two of its Austin chip factories due to Texas weather anomalies. Auto chip manufacturer&nbsp;Renesas Electronics Corp&rsquo;s&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/rnecf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">RNECF</a>) Japanese plant was&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/04/20614381/the-global-chip-shortage-worst-hit-stocks-and-industries-potential-beneficiaries" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">hampered by</a>&nbsp;the February earthquake and a March fire.</li>
<li>Taiwan&rsquo;s three science industrial parks responsible for most of the chip-making facilities had to limit their water intake but were exempt from stoppages to date. However, it was affecting some of the companies.</li>
<li>Alternative sources of water and acceleration of conservation would escalate the production costs after supply to one of its chip facilities were reduced, stated&nbsp;Micron Technology Inc&nbsp;(NASDAQ:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/mu#NASDAQ" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">MU</a>), which had facilities in Taichung and Taoyuan.</li>
<li>Hsinchu-based TSM and&nbsp;United Microelectronics Corp&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/umc#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">UMC</a>) had secured alternate water supply sources. TSM was also trying to utilize groundwater from their construction sites.</li>
<li>TSM did not estimate any significant impact on operations despite the tight water supply.</li>
<li>However, Taiwan&rsquo;s water crisis fueled by climate change could jeopardize global chip production due to their high production concentration in the island country, stated its officials and scholars.</li>
<li>Taiwan introduced a drought disaster response agency in October.</li>
<li>The government stopped the water supply for two days per week to some parts of the island from April. TSM aimed to reduce its water requirement per unit by 30% from 2010 levels by 2030.</li>
<li>TSM accounted for around 4.5% of Taiwan&rsquo;s GDP in 2018, and chip sales accounted for 64% of Taiwan&rsquo;s export growth on average over the past five years.&nbsp;</li>
<li>Germany has sought Taiwan&rsquo;s assistance to secure chip supply for German car manufacturers.</li>
<li>Price action:&nbsp;TSM shares traded flat at $118.35 on the last check Friday.</li>
</ul>

Taiwan's Drought Poses Additional Threat To Looming Global Chip Crisis: WSJ

<ul>
<li>The global chip crisis, which was intensified by the February Texas winter storm, is expected to affect carmaker production by 1.3 million vehicles this quarter,&nbsp;<a class="editor-rtfLink" href="https://www.bloomberg.com/news/articles/2021-03-31/chip-shortage-costs-carmakers-output-of-1-3-million-vehicles?srnd=technology-vp&amp;sref=TBDibEcD" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">Bloomberg reports</a>&nbsp;based on&nbsp;IHS Markit Ltd&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/info#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">INFO</a>).</li>
<li>The latest fire at auto-chip maker&nbsp;Renesas Electronics Corp&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/rnecf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">RNECF</a>) (OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/rnecy#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">RNECY</a>) can upset the Japanese and U.S. operations for at least a month hampering the industry&rsquo;s second-quarter output.</li>
<li>Semiconductor supply is not expected to even out until the fourth quarter, as per IHS analysts.</li>
<li>Samsung Electronics Co Ltd&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/ssnlf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">SSNLF</a>)&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/03/20398784/samsungs-austin-chip-production-back-near-normalcy-levels-reuters" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">recently reported</a>&nbsp;it resumed near normal production levels at the Austin, Texas chip plant. The company also acknowledged a revenue hit along with&nbsp;NXP Semiconductors NV&nbsp;(NASDAQ:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/nxpi#NASDAQ" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">NXPI</a>) and&nbsp;Infineon Technologies AG&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/ifnnf#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">IFNNF</a>) (OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/ifnny#OTC" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">IFNNY</a>) following its Texas production shutdown due to the February storm.</li>
<li>General Motors Co&nbsp;(NYSE:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/gm#NYSE" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">GM</a>)&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/news/21/03/19989722/general-motors-extends-production-cut-amidst-chip-crisis-reuters" style="color:#4a6ee0; background:transparent; margin-top:0pt; margin-bottom:0pt" target="_blank">recently extended</a>&nbsp;production cuts at three North American plants and added a fourth to the factories list.</li>
</ul>

IFNNY

INFO

Global Chip Crisis Estimated To Jeopardize 1.3M Vehicle Production: Bloomberg

<ul>
<li>Japan&rsquo;s&nbsp;Renesas Electronics Corporation&nbsp;(OTC: <a class="ticker" href="https://www.benzinga.com/stock/rnecf#OTC">RNECF</a>)&nbsp;<a class="editor-rtfLink" href="https://www.dialog-semiconductor.com/sites/default/files/joint_press_release_eng_final.pdf" style="color: rgb(14, 16, 26); background: transparent; margin-top:0pt; margin-bottom:0pt;; color: #4a6ee0;" target="_blank">has agreed to acquire</a>&nbsp;Dialog Semiconductor plc&nbsp;(OTC:&nbsp;<a class="editor-rtfLink" href="https://www.benzinga.com/stock/dlgnf#OTC" style="color: rgb(14, 16, 26); background: transparent; margin-top:0pt; margin-bottom:0pt;; color: #4a6ee0;" target="_blank">DLGNF</a>) in a cash transaction for &euro;67.50 per share, at a roughly $5.89 billion (&euro;4.9 billion) valuation. The U.K.-based chip designer is a supplier to companies like Apple Inc (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>).</li>
<li>The purchase price signifies a premium of 20% premium to Dialog&rsquo;s Friday close of &euro;56.12 in Frankfurt.</li>
<li>The acquisition will play a crucial role in consolidating Renesas&rsquo; global footprint across large, high-growth markets in the IoT, industrial and automotive fields with Dialog&rsquo;s low-power technologies and connectivity expertise around its mixed-signal integrated circuits, including complementary product lines.</li>
<li>Renesas estimates acquisition synergies worth $200 million from revenue, $198.8 million within the next four to five years from operating income from cross-selling, burgeoning industries, and continued innovation.</li>
<li>Renesas might either finance the acquisition via a bank loan or equity.</li>
<li>The transaction is estimated to close by the end of 2021, subject to regulatory approvals and closing conditions.</li>
<li>Price action:&nbsp;DLGNF shares are up 8.23% at $68.26 at the pre-market session on the last check Monday. Renesas shares fell 3.61% in Tokyo exchange.</li>
</ul>

Global

DLGNF

Renesas Set To Acquire Apple Supplier Dialog Semiconductor For $5.9B

Intraday Update

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AllianzGI Convertible & Income 2024 Target Term Fund Common Shares of Beneficial Interest

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Stocks That Hit 52-Week Highs On Thursday

View article <a href="http://asia.nikkei.com/Business/Deals/Novatek-to-benefit-from-Apple-Renesas-deal-Barclays">http://asia.nikkei.com/Business/Deals/Novatek-to-benefit-from-Apple-Renesas-deal-Barclays</a>

Rumors

Novatek Microelectronics to Benefit from Rumored Apple-Renesas Electronics Deal, According to Barclays -Nikkei

The following are the M&amp;A deals, rumors and chatter circulating on Wall Street for Tuesday April 1, 2014:

Vistaprint Acquire PixarPrinting SRL for €127M

The Deal: Vistaprint (NASDAQ: <a class="ticker" href="/stock/vprt#NASDAQ">VPRT</a>) announced Tuesday it has agreed to acquire Italy's Pixartprinting Srl for a base purchase price of approximately €127 million, plus a sliding-scale earn-out of up to €10 million for Pixartprinting, based on revenue and EBITDA performance targets for calendar year 2014. Vistaprint will own 97 percent of Pixartprinting, and 3 percent retained ownership by Pixartprinting's founder.

Vistaprint expects the deal to close during Q4 of FY2014.

Vistaprint shares closed Tuesday at $50.30, a gain of 2%. 

Anixter Sale Process Reportedly Stalls

The Talks: Shares of Anixter International (NYSE: <a class="ticker" href="/stock/axe#NYSE">AXE</a>) fell sharply on a report from Bloomberg that sale talks have stalled, according to sources. Potential buyers were said to include French electrical-equipment distributor Rexel SA (OTC: RXLSF), and PE funds Advent International and CVC Capital Partners. Sources report the three parties have chosen not to bid.

A spokesperson for Anixter declined comment.

Anixter International closed Tuesday at $30.36, a gain of $7.30, a gain of 132% on 37 times average volume. 

Report Ellie Mae No Longer for Sale

The Rumor: Shares of Ellie Mae (NYSE: <a class="ticker" href="/stock/elli#NYSE">ELLI</a>) fell Tuesday, following a report from Inside Mortgage Finance that the company was no longer for sale and was pursuing potential acquisitions. In November, Silver Lake was mentioned as a potential bidder for the residential mortgage software company.

A spokesperson for Ellie Mae was not available for comment.

Ellie Mae closed Tuesday at $28.39, losing 1.5%.

Apple Reportedly in Talks to Acquire Renesas Electronics Stake in JV

The Rumor: Apple (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>) is in talks to buy Renesas Electronics' (OTC: <a class="ticker" href="/stock/rnecf#OTC">RNECF</a>) 55% stake in Renesas SP Drivers for approximately $483M, according to Nikkei, citing a source. The unit, which is a joint venture with Sharp and Powerchip, designs LCD chips for iPhones.

Apple reportedly will complete the acquisition by the summer, according to the source.

Apple closed Tuesday at $541.65, gaining almost 1%.


.

ELLI

VPRT

Benzinga's M&A Chatter for Tuesday April 1, 2014

McGraw-Hill Companies Inc (NYSE: <a class="ticker" href="/stock/mhp#NYSE">MHP</a>) reported a 39% rise in its fourth-quarter net income. McGraw-Hill's quarterly net income surged to $214 million, or $0.73 per share, from $154 million, or $0.50 per share, in the year-earlier period. Its adjusted profit came in at $0.63 per share. McGraw-Hill's revenue climbed 2% to $1.52 billion. However, analysts were expecting earnings of $0.57 per share on revenue of $1.53 billion. 

United Parcel Service Inc (NYSE: <a class="ticker" href="/stock/ups#NYSE">UPS</a>) reported a drop in its fourth-quarter profit. UPS' quarterly profit fell to $725 million, or $0.74 per share, from $1.03 billion, or $1.02 per share, in the year-ago period. Its sales climbed 6% to $14.2 billion. Excluding one-time items, UPS earned $1.28 per share. However, analysts were expecting a profit of $1.27 per share on sales of $14.5 billion.

Exxon Mobil Corp (NYSE: <a class="ticker" href="/stock/xom#NYSE">XOM</a>) reported a 2% rise in its fourth-quarter profit. Exxon Mobil's quarterly profit climbed to $9.4 billion, or $1.97 per share, from $9.25 billion, or $1.85 per share, in the year-earlier period. Oil-equivalent production dropped 9%. However, analysts were expecting earnings of $1.97 per share.

Tyco International Ltd (NYSE: <a class="ticker" href="/stock/tyc#NYSE">TYC</a>) reported a drop in its fiscal first-quarter net income. Tyco's quarterly net income attributable to shareholders dropped to $333 million, or $0.71 per share, from $659 million, or $1.34 per share, in the year-ago period. Its earnings from continuing operations, excluding special items, climbed to $0.84 from $0.75 per share. However, analysts were expecting earnings of $0.79 per share. Its revenue dropped 4% to $4.2 billion.

Danaher Corp (NYSE: <a class="ticker" href="/stock/dhr#NYSE">DHR</a>) reported a rise in its fourth-quarter profit. Danaher's quarterly profit climbed to $570.7 million, or $0.80 per share, from $473.9 million, or $0.69 per share, in the year-ago period. Its sales surged to $4.72 billion from $3.43 billion. However, analysts were expecting a profit of $0.78 per share on sales of $4.69 billion. 

Mattel Inc (NASDAQ: <a class="ticker" href="/stock/mat#NASDAQ">MAT</a>) reported a rise in its fourth-quarter net income. Mattel's quarterly net income surged to $370.6 million, or $1.08 per basic share, from $325.2 million, or $0.90 per basic share, in the year-earlier period. Its net sales rose to $2.15 billion from $2.12 billion. However, analysts were expecting a net profit of $345.9 million or $1.00 per share. 

Eli Lilly &amp; Co (NYSE: <a class="ticker" href="/stock/lly#NYSE">LLY</a>) reported a 27% drop in its fourth-quarter net income. Eli Lilly's quarterly net income dropped to $858.2 million, or $0.77 per share, from $1.17 billion, or $1.05 per share, in the year-earlier period. Its sales declined to $6.05 billion from $6.19 billion.

Helmerich &amp; Payne Inc (NYSE: <a class="ticker" href="/stock/hp#NYSE">HP</a>) reported upbeat first-quarter results. Helmerich &amp; Payne's quarterly profit rose to $144.3 million, or $1.32 per share, from $104.2 million, or $0.96 per share, in the year-ago period. Excluding items, Helmerich &amp; Payne earned $1.29 per share, versus analysts' estimates of $1.16 per share. Helmerich &amp; Payne's operating revenue climbed 23% to $732.6 million, versus analysts' estimates of $727.57 million.

Waddell &amp; Reed Financial Inc (NYSE: <a class="ticker" href="/stock/wdr#NYSE">WDR</a>) reported a 14% drop in its fourth-quarter profit. Waddell &amp; Reed's quarterly net income fell to $40.0 million, or $0.47 per share, from $46.4 million, or $0.54 per share, in the year-ago period. However, analysts were expecting earnings of $0.48 per share.

Pfizer Inc (NYSE: <a class="ticker" href="/stock/pfe#NYSE">PFE</a>) reported a drop in its fourth-quarter profit. Pfizer's quarterly profit declined to $1.44 billion, or $0.19 per share, from $2.89 billion, or $0.36 per share, in the year-ago period. Its sales fell to $16.75 billion from $17.35 billion. Pfizer's adjusted earnings came in at $0.50 per share. However, analysts were expecting a profit of $0.47 per share on sales of $16.61 billion. 

Archer Daniels Midland Co (NYSE: <a class="ticker" href="/stock/adm#NYSE">ADM</a>) reported an 89% drop in its fiscal second-quarter earnings. Archer Daniels Midland's quarterly profit fell to $80 million, or $0.12 per share, from $732 million, or $1.14 per share, in the year-ago period. Its revenue rose 11% to $23.31 billion. Archer Daniels Midland's earnings adjusted for inventory and impairment charges came in at $0.51 per share. However, analysts were expecting earnings of $0.76 per share on revenue of $22.82 billion. 

Mitsubishi Corp (OTC: <a class="ticker" href="/stock/msbhy#OTC">MSBHY</a>) reported a 2.2% rise in its net profit for the nine months ended December. Mitsubishi posted a group net profit at Y370.19 billion, up from Y362.15 billion, in the year-ago period. Its revenue rose 5.5% to Y15.170 trillion versus Y14.384 trillion. Mitsubishi's operating profit dropped 14% to Y232.95 billion.

Sumitomo Mitsui Financial Group Inc (NYSE: <a class="ticker" href="/stock/smfg#NYSE">SMFG</a>) reported a 20.2% decline in its group net profit for the April-December period. Sumitomo Mitsui's profit fell to Y411.00 billion, down from Y515.14 billion, in the year-ago period. The bank's operating revenue climbed 0.8% to Y2.935 trillion from Y2.912 trillion.

Daiichi Sankyo Co (OTC: <a class="ticker" href="/stock/dskyf#OTC">DSKYF</a>) posted a loss for the fiscal third quarter and cut its full-year forecast. For the October-December quarter, Daiichi Sankyo posted a net loss of Y19.5 billion, versus a year-ago profit of Y27.5 billion. Its operating profit fell 2.6% to Y29.7 billion versus Y30.5 billion. Its revenue fell 3.5% to Y240.4 billion from Y249.2 billion. 

CIT Group Inc (NYSE: <a class="ticker" href="/stock/cit#NYSE">CIT</a>) reported a 59% drop in its fourth-quarter profit. CIT Group's quarterly net income fell to $33.9 million, or $0.17 per share, from $83.2 million, or $0.41 per share, in the year-ago period. CIT Group's total interest income dropped 35% y/y to $492.4 million.

Toshiba Corp (OTC: <a class="ticker" href="/stock/tosyy#OTC">TOSYY</a>) swung to a loss in the fiscal third quarter and lowered its full-year net profit forecast. Toshiba posted a net loss of Y10.6 billion for the period, versus a year-ago profit of Y12.37 billion. Its operating profit dipped 72% to Y10.53 billion versus Y37.46 billion. Toshiba's revenue dropped 9.3% to Y1.441 trillion from Y1.588 trillion. 

Banco Santander SA (NYSE: <a class="ticker" href="/stock/std#NYSE">STD</a>) reported a drop in its fourth-quarter net profit. Santander's quarterly net profit fell to 47 million euros ($62 million), from €2.1 billion, in the year-earlier period. Its net interest income rose to €7.97 million, from €7.33 million. For 2011, Santander's net profit dropped to €5.35 billion, from €8.18 billion, in the year-earlier period.

Daiwa Securities Group Inc (OTC: <a class="ticker" href="/stock/dseey#OTC">DSEEY</a>) posted a loss in the October-December period. Daiwa Securities posted a loss of Y21.57 billion in the period, versus a net loss of Y19.35 billion in the July-September quarter. The company posted a net profit of Y1.18 billion in the year-ago period. Daiwa Securities' revenue dropped 21% to Y92.92 billion versus Y118.21 billion.

Honda Motor Co (NYSE: <a class="ticker" href="/stock/hmc#NYSE">HMC</a>) reported a 41% drop in its net profit for the fiscal third quarter. Honda's net profit fell to Y47.66 billion, from Y81.12 billion, in the year-ago quarter. However, analysts were expecting a net profit of Y69.49 billion. Its sales dropped 8.0% to Y1.943 trillion versus Y2.110 trillion. Honda's operating profit tumbled 65% to Y44.30 versus Y125.65 billion. 

TDK Corp (OTC: <a class="ticker" href="/stock/ttdky#OTC">TTDKY</a>) swung to a loss in the fiscal third quarter. TDK posted a net loss of Y11.6 billion for the October-December period, versus a year-ago net profit of Y12.6 billion. Its revenue fell to Y191.8 billion from Y219.94 billion. TDK's operating profit dipped to Y7.03 billion from Y17.21 billion. 

Fujitsu Ltd (OTC: <a class="ticker" href="/stock/fjtsy#OTC">FJTSY</a>) swung to a net loss for the fiscal third quarter and cut its earnings target for the full fiscal year through March 31. Fujitsu posted a net loss of Y4.3 billion, versus a year-ago profit of Y16.55 billion. Its operating profit dipped 85% to Y3.1 billion from Y21.2 billion. However, its revenue dropped 1.5% to Y1.080 trillion versus Y1.096 trillion. 

ARM Holdings PLC (NASDAQ: <a class="ticker" href="/stock/armh#NASDAQ">ARMH</a>) reported a rise in its fourth-quarter profit. ARM Holdings' quarterly pretax profit climbed 45% to 69 million pounds ($108 million). Its sales climbed to 137.8 million pounds, from 113.9 million pounds. However, analysts were expecting a pretax profit of 55.8 million pounds on sales of 123.6 million pounds.

Renesas Electronics Corp (OTC: <a class="ticker" href="/stock/rnecf#OTC">RNECF</a>) reported a narrower net loss for the fiscal third quarter and cut its earnings forecast for this fiscal year ending March. Renesas Electronics posted a net loss of Y2.41 billion, versus a year-ago net loss of Y17.58 billion. Its sales dropped 19% to Y222.86 billion, from Y275.17 billion. It posted an operating loss of Y3.97 billion, versus a year-ago profit of Y3.41 billion. 

British Sky Broadcasting Group PLC (OTC: <a class="ticker" href="/stock/bsyby#OTC">BSYBY</a>) reported an 8.4% rise in its first-half net profit. BSkyB's net profit for the period rose to GBP441 million, from GBP407 million, in the year-ago period. Its revenue climbed 6% to GBP3.36 billion. BSkyB's first-half operating profit before exceptional items, surged 16% to GBP601 million versus GBP520 million.

Earnings

Pre-Market Outlook

ARMH

BSYBY

DSEEY

DSKYF

FJTSY

MSBHY

SMFG

TOSYY

TTDKY

Earnings Roundup

Renesas Electronics Corp (OTC: RNECF) reported a narrower net loss for the fiscal third quarter and cut its earnings forecast for this fiscal year ending March. 

Renesas Electronics posted a net loss of Y2.41 billion, versus a year-ago net loss of Y17.58 billion. Its sales dropped 19% to Y222.86 billion, from Y275.17 billion. It posted an operating loss of Y3.97 billion, versus a year-ago profit of Y3.41 billion. 

Renesas Electronics now projects a net loss of Y57 billion, versus a net loss of Y40 billion. It also lowered its sales forecast to Y885 billion from Y968 billion.

Guidance

Renesas Electronics Posts Narrower FQ3 Loss, Lowers Forecast

indie Semiconductor: 50 Top Growth Stocks, These 3 Worth Considering

Japan's Renesas extends tender offer for proposed acquisition of chip maker Sequans

While Intel (INTC) topped Street revenue and profit estimates in the last reported quarter, will it be able to maintain its performance in the to-be-reported quarter that ended December 2023? Let's discuss its fundamentals to gauge its prospects... Intel Corporation (<a href="https://stocknews.com/stock/INTC/">INTC</a>) celebrated the opening of Fab 9, its cutting-edge factory in Rio Rancho, New Mexico on January 24, <a href="https://finance.yahoo.com/news/intel-opens-fab-9-mexico-150000517.html">marking a milestone for high-volume manufacturing of 3D advanced packaging technologies</a>.
This facility, the company's first high-volume semiconductor center, is the sole U.S. factory that fabricates the world's most sophisticated packaging solutions on a large scale. Intel's network of factories worldwide forms a competitive edge, facilitating product enhancement and efficiency.
Turning to its financial performance, Intel surpassed projections for profit and sales during the third quarter despite experiencing a decline in revenue compared to the same period last year.
The firm saw a sales drop of 8%, falling from $15.33 billion in the previous year, marking the seventh quarter in a row that experienced decreasing sales. Intel's net income was recorded at $297 million, or 7 cents per share, a stark contrast to the net income of $1.02 billion, or 25 cents per share, during the same period the prior year.
For the fourth quarter, Intel is projecting earnings of 23 cents per share on revenue between $14.6 billion and $15.6 billion. Meanwhile, market analysts forecast Intel's EPS and revenue will significantly boost to $0.45 and $15.17 billion, respectively in the quarter ended December 2023. However, they are expecting the annual revenue and EPS to settle at $53.98 billion and $0.96, revealing a decrease of 14.4% and 48.1% year-over-year, respectively.
In light of burgeoning competition within the AI chip sector and prevailing macroeconomic uncertainties, it may be prudent to await a more favorable point of entry into the stock. A closer inspection of Intel's key performance indicators could prove insightful.
Analyzing Intel Corporation's Fluctuating Financial Performance (March 2021 - September 2023)
The trailing-12-month Net Income of INTC, shows a fluctuating trend over the period from March 2021 to September 2023.
<ul>
<li>In the first quarter 2021 (March 27, 2021), the Net Income was $18.6 billion.</li>
<li>It slightly decreased in the second quarter, reaching $18.55 billion by June 26, 2021.</li>
<li>There was a rise to $21.1 billion by September 25, followed by a mild drop to $19.87 billion at the end of the year.</li>
<li>In 2022, the Net Income notably increased in the second quarter (April 2), elevating to $24.62 billion. But it followed a downward trajectory for the rest of the year, recording $19.11 billion in the third quarter (July 2), and drastically plummeted in the fourth quarter to $13.3 billion and then $8.01 billion on October 1 and December 31 respectively.</li>
<li>The downward trend of INTC's Net Income persisted into 2023, showing the company incurred losses throughout the year; -$2.86 billion in the first quarter (April 1), -$0.92 billion in second quarter (July 1), and -$1.64 billion by the end of third quarter (September 30).</li>
</ul>
Regarding growth rate, the decrease in the last value of Net Income from the first value presents a declining trend of -150.18% during the considered period. The more recent data indicates an alarming downward trend with the company experiencing losses in the year 2023.
<img src="https://storage.googleapis.com/sjn-charts/visualized-metrics/1706118250.23621.png" />
The data series documents the fluctuating trailing-12-month Revenue trends of Intel Corporation (INTC) from March 27, 2021 to September 30, 2023.
<ul>
<li>On March 27, 2021, INTC reported a Revenue of $77.71 billion.</li>
<li>There were slight variations over the subsequent quarters with it reaching $79.02 billion by December 25, 2021.</li>
<li>However, starting 2022, the trend showed a significant downward tendency. On April 2, 2022, the Revenue decreased slightly to $77.70 billion before experiencing a substantial drop to $63.05 billion by the end of the year.</li>
<li>The downward trend continued into 2023, with Revenue falling further to $52.86 billion as of September 30, 2023.</li>
</ul>
The most notable aspect of this dataset is the constant decline in Revenue between the fourth quarter of 2022 and the third quarter of 2023. When comparing the first and last data points (from $77.71 billion in March 2021 to $52.86 billion in September 2023), this signifies a growth rate of -46%, indicating a significant reduction in Revenue over the measured period.
<img src="https://storage.googleapis.com/sjn-charts/visualized-metrics/1706118299.63342.png" />
The Gross Margin of Intel Corporation (INTC) demonstrates a number of fluctuations and shows an overall downward trend over the period from March 27, 2021 to September 30, 2023. It's worth reviewing this series of percentages:
<ul>
<li>In March 2021, the Gross Margin stood at 54.6%.</li>
<li>There was a small increase in the following quarter, reaching 55.6% by June 2021.</li>
<li>By September 2021, the margin had increased slightly again to 56.3%, presenting the highest figure in the series.</li>
<li>The last quarter of 2021 recorded a slight decrease to 55.4% in December.</li>
<li>A more noticeable drop occurred in 2022, with the Gross Margin rating lower at 54.3% by April and just 49.8% by July.</li>
<li>The declining trend continued into October, where the margin slipped further to 46.6%.</li>
<li>By the end of 2022, the Gross Margin had dipped significantly to 42.6%.</li>
<li>In 2023, sharp declines continued with the margins standing at 38.3% in both April and July.</li>
<li>The data series ends with the Gross Margin at 38.1% in September 2023, the lowest in the period.</li>
</ul>
The overall growth rate from March 2021 to September 2023 shows a decrease of approximately 16.5 percentage points. Emphasizing recent data, it's evident that the Gross Margin has been experiencing a steady decline over the past year. This suggests challenges for INTC in maintaining its profitability margins.
<img src="https://storage.googleapis.com/sjn-charts/visualized-metrics/1706118335.14275.png" />
The data presented exhibits the trend and fluctuations in the <a href="https://www.investopedia.com/terms/c/currentratio.asp">Current Ratio</a> of Intel Corporation (INTC) from March 27, 2021, to September 30, 2023. The Current Ratio is a measure of the company's financial health, showcasing its ability to cover short-term liabilities with short-term assets. Let's break down this period into significant points:
<ul>
<li>On March 27, 2021, INTC had a Current Ratio of 1.90.</li>
<li>A gradual increase in the Current Ratio was observed through the first four data points, peaking at 2.10 on December 25, 2021.</li>
<li>A downward trend then emerged starting April 2, 2022, when the Current Ratio fell to 2.13, reaching its lowest at 1.57 by the end of the year on December 31, 2022.</li>
<li>The Current Ratio subsequently experienced a slight uptick, increasing to 1.76 as of April 1, 2023. However, it then saw another decrease, reporting at 1.53 by the end of the examined period on September 30, 2023.</li>
</ul>
From the first value (1.90) to the last value in the series (1.53), the Current Ratio decreased by approximately -19.5%, indicating an overall decrease in INTC's short-term liquidity during this period. The fluctuating trend suggests a variable financial condition for the company, with greater emphasis on the recent downward trend, which may indicate challenges in meeting its short-term obligations.
<img src="https://storage.googleapis.com/sjn-charts/visualized-metrics/1706118426.24306.png" />
Tracking Intel Corporation's Share Price Fluctuations: July 2023 to January 2024
Based on the given data, the share price of Intel Corporation (INTC) has been exhibiting some significant changes over the period from July 2023 to January 2024. Here is a detailed overview bulleted list:
July 2023 - September 2023: The share price showed a generally decreasing trend, with it starting at $36.55 on July 28, 2023, and dropping to $35.24 by August 4, 2023. The lowest value was recorded in late August at $33.12, but beginning September, the prices start to hike again, reaching a peak by mid-September at $38.58.
September 2023 - October 2023: The rest of September saw a reduction in the share price down to $34.68 by its end. This descending trend continued into October, with small fluctuations in between. A slight increase was seen by October 13, 2023, where it reached up to $36.39, but by October 27, 2023, it fell down to $34.03.
November 2023 - December 2023: Beginning November, the share prices started to ascend prominently. By November 24, 2023, the shares were priced at $44, with a peak price of $50.33 being achieved by December 29, 2023.
January 2024: In the initial weeks of January, the share prices experienced a slight decrease to $46.93 by January 19. However, by January 23, 2024, a rebound ensued, and the share prices rose to $48.29. In summary, the data exhibits an initial downward trend from July 2023 to October 2023, followed by a significant upward trend that continued till the end of December 2023. Afterward, January 2024 saw some fluctuations with general stability towards the end.
The overall growth rate over this period has been positive, showing that Intel Corporation (INTC) experienced an increase in share prices over this timeframe. Here is a chart of INTC's price over the past 180 days.
<img src="https://storage.googleapis.com/sjn-charts/visualized-metrics/1706118596.94285.png" />
Assessing Intel Corporation's Momentum, Sentiment, and Growth through POWR Ratings
INTC has an overall C rating, translating to a Neutral in our <a href="https://stocknews.com/powr-ratings/">POWR Ratings</a> system. It is ranked #38 out of the 91 stocks in the <a href="https://stocknews.com/category/semiconductor-wireless-chip/">Semiconductor &amp; Wireless Chip</a> category.
When we examine the data, it becomes apparent that the three most noteworthy POWR Ratings for Intel Corporation (INTC) are momentum, sentiment, and growth.
Momentum
The momentum dimension has consistently received high ratings. This encompasses a significant range from 71 to 87, with its peak observed in December 2023. Notably, its value remains steady at 78 over several periods such as in July, September, November 2023, indicating that INTC is maintaining a strong momentum.
Sentiment
The sentiment shows a strong increase â€" it rises from 68 in July 2023 to an impressive 92 by August and November of the same year. However, it slightly fluctuates downwards, reaching 79 in December, and then bounces back to 83 in January 2024. This demonstrates a generally high investor sentiment towards INTC.
Growth
Concerning the Growth dimension, a clear positive trend is evident. Beginning at 32 in July 2023, the rating plunges to a low of 21 in August and September. However, this is followed by a remarkable surge to a peak of 86 by November 2023, a rating which is maintained through January 2024. This suggests a solid growth performance and potential for INTC.
<img src="https://storage.googleapis.com/sjn-charts/visualized-metrics/1706118675.23224.png" />
&nbsp;
How does Intel Corporation (INTC) Stack Up Against its Peers?
Other stocks in the Semiconductor &amp; Wireless Chip sector that may be worth considering are ChipMOS TECHNOLOGIES INC. (<a href="https://stocknews.com/stock/IMOS">IMOS</a>), Infineon Technologies AG (<a href="https://stocknews.com/stock/IFNNY">IFNNY</a>), and Renesas Electronics Corporation (<a href="https://stocknews.com/stock/RNECF">RNECF</a>) -- they have better POWR Ratings.
What To Do Next?
43 year investment veteran, Steve Reitmeister, has just released his 2024 market outlook along with trading plan and top 11 picks for the year ahead.
<a href="https://report.stocknews.com/sign-up/stock-market-outlook-2024/?formplacement=artbotad_smo24_rep">2024 Stock Market Outlook &gt;</a>

<hr />
INTC shares were trading at $49.02 per share on Wednesday afternoon, up $0.13 (+0.27%). Year-to-date, INTC has declined -2.45%, versus a 2.47% rise in the benchmark S&amp;P 500 index during the same period.
<hr><div style="clear:both;"></div> <h2>About the Author: Subhasree Kar</h2> <img src='https:/wp-content/uploads/2021/06/Subhasree-Kar-HS2.jpg' style="float:left; padding:5px;width:125px;">Subhasree's keen interest in financial instruments led her to pursue a career as an investment analyst. After earning a Master's degree in Economics, she gained knowledge of equity research and portfolio management at Finlatics.<a href="https://stocknews.com/authors/?author=subhasree-kar">More...</a>The post <a href=https://stocknews.com/news/intc-imos-ifnny-rnecf-intel-intc-investors-prepare-for-earnings-release-buy-or-hold/>Intel (INTC) Investors Prepare for Earnings Release: Buy or Hold?</a> appeared first on <a href=https://stocknews.com/>StockNews.com</a>

Intel (INTC) Investors Prepare for Earnings Release: Buy or Hold?

Baron International Growth Fund Q4 2023 Shareholder Letter

Advanced Micro Devices (AMD) will release its fourth-quarter earnings on January 30. With analysts expecting the company to report a year-over-year increase in EPS and revenue, we assess whether it could be wise to buy the stock ahead of the earnings release. Keep reading… Advanced Micro Devices, Inc. (<a href="https://stocknews.com/stock/AMD/">AMD</a>) is scheduled to report its fourth-quarter results on January 30. Wall Street expects the company's EPS and revenue for the quarter to improve over the year-ago quarter.
Looking at the recent trends, although AMD enjoys tailwinds arising out of the high demand for AI-focused chips, its other segments continue to face challenges. The fourth-quarter numbers can offer better insights on this front.
In this piece, I have discussed why it could be wise to avoid the stock despite the expected improvement in its financials.
For the fourth quarter, AMD's EPS and revenue are expected to increase 11.6% and 9.6% year-over-year to $0.77 and $6.14 billion, respectively. The company has a solid earnings history, having beaten the consensus estimates in each of the trailing four quarters.
AMD's Data Center segment's revenue in the third quarter was flat year-over-year, coming in at $1.60 billion. Its Client segment revenue was higher by 42.2% year-over-year to come in at $1.45 billion, primarily driven by higher Ryzen mobile processor sales. However, its Gaming segment and Embedded segment revenues were down 7.7% and 4.6% year-over-year to $1.51 billion and $1.24 billion, respectively.
AMD's Chair and CEO, Dr. Lisa Su, said, "We delivered strong revenue and earnings growth driven by demand for our Ryzen 7000 series PC processors and record server processor sales. Our data center business is on a significant growth trajectory based on the strength of our EPYC CPU portfolio and ramp of Instinct MI300 accelerator shipments to support multiple deployments with hyperscale, enterprise, and AI customers."
AMD's EVP, CFO, and Treasurer Jean Hu said, "We executed well in the third quarter, delivering year-over-year growth in revenue, gross margin, and earnings per share." For the fourth quarter, the company expects its revenue to be approximately $6.10 billion, plus or minus $300 million, representing a year-over-year growth of roughly 5% at the mid-point of the revenue range.
Its non-GAAP gross margin is expected to be approximately 51.5%. Post its third quarter results, Jean Hu said, "In the fourth quarter, we expect to see strong growth in Data Center and continued momentum in Client, partially offset by lower sales in the Gaming segment and additional softening of demand in the embedded markets."
On October 10, 2023, AMD announced the agreement to acquire Nod.ai to expand its open AI software capabilities. The acquisition of Nod.ai aligns with AMD's AI growth strategy centered on an open software ecosystem that lowers the barriers of entry for customers through developer tools, libraries and models.
Nod.ai's software technology accelerates the deployment of AI solutions optimized for AMD Instinct data center accelerators, Radeon GPUs, Ryzen AI processors, and EPYC processors. Furthermore, the company's AMD Instinct MI300A and MI300X GPUs are on track for volume production in the fourth quarter to support deployments with several leading HPC, cloud and AI customers.
Also, during the fourth quarter, AMD announced the AMD Ryzen Threadripper PRO 7000 WX-Series and reintroduced the Threadripper processor lineup for high-end desktop space, with the Ryzen Threadripper 7000 processors helping deliver high-end performance for desktop users. On October 19, 2023, the company introduced the fastest AMD Radeon GPU ever developed for laptops, called the AMD Radeon RX 7900M.
AMD's stock has gained 106.3% over the past nine months and 135.8% over the past year to close the last trading session at $177.25.
Here's what you might want to consider ahead of its upcoming earnings release:
Mixed Fundamentals
AMD's revenue for the third quarter ended September 30, 2023, rose 4.2% year-over-year to $5.80 billion. Its non-GAAP gross profit increased 6.7% over the prior-year quarter to $2.96 billion. The company's non-GAAP operating income rose marginally year-over-year to $1.28 billion. Also, its non-GAAP net income increased 3.7% year-over-year to $1.14 billion. In addition, its non-GAAP EPS came in at $0.70, representing an increase of 4.5% year-over-year.
On the other hand, its non-GAAP operating margin declined by one percentage point to come in at 22%. In addition, its net cash provided by operating activities declined 56.4% year-over-year to $421 million.
Mixed Analyst Estimates
Analysts expect AMD's EPS and revenue for fiscal 2023 to decline 24.2% and 4% year-over-year to $2.65 and $22.66 billion, respectively. Its EPS and revenue for fiscal 2024 are expected to increase 47.6% and 18.5% year-over-year to $3.92 and $26.85 billion, respectively.
Stretched Valuation
In terms of forward <a href="https://www.investopedia.com/terms/e/ev-ebitda.asp">EV/EBITDA</a>, AMD's 66.92x is 325.3% higher than the 15.73x industry average. Likewise, its 12.51x forward EV/Sales is 323.7% higher than the 2.95x industry average. Its 66.78x forward non-GAAP P/E is 168.8% higher than the 24.85x industry average.
Weak Profitability
AMD's 0.38% trailing-12-month Return on Common Equity is 74.7% lower than the 1.50% industry average. Likewise, its 0.94% trailing-12-month net income margin is 54.7% lower than the 2.07% industry average. Furthermore, the stock's 0.33x trailing-12-month asset turnover ratio is 47.1% lower than the industry average of 0.62x.
Also, AMD's trailing-12-month EBIT margin is negative 0.41% compared to the 4.68% industry average. Likewise, its trailing-12-month Return on Total Capital is negative 0.10% compared to the 2.69% industry average.
POWR Ratings Reflect Bleak Prospects
AMD has an overall D rating, equating to a Sell in our <a href="https://stocknews.com/powr-ratings/">POWR Ratings</a> system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.
Our proprietary rating system also evaluates each stock based on eight distinct categories. AMD has a D grade for Value, in sync with its stretched valuation. It has a D grade for Quality, consistent with its weak profitability.
Also, its 1.70 beta justifies its D grade for Stability.
AMD is ranked #80 out of 91 stocks in the <a href="https://stocknews.com/category/semiconductor-wireless-chip/">Semiconductor &amp; Wireless Chip</a> industry. <a href="https://stocknews.com/stock/AMD/">Click here</a> to access AMD's Growth, Momentum, and Sentiment ratings.
Bottom Line
AMD is expected to report a year-over-year improvement in revenue and earnings for the fourth quarter. Its Client and Data Center segments are expected to see double-digit year-over-year growth, driven by the recovering PC market and growing demand for AI-focused chips.
However, its Gaming and Embedded segments are expected to continue witnessing a decline in revenues over the prior-year quarter as gaming chip demand remains weak. Also, softness in the embedded markets due to destocking will hurt Embedded segment revenues in the fourth quarter.
Meanwhile, with the rollout of its MI300A and MI300X GPUs, the company is expected to see substantial long-term growth in its Data Center segment revenues. However, competition is rising in this segment.
Despite the anticipated growth in its Data Center segment, the company continues to face challenges in the Gaming and Embedded segments. Moreover, its weak profitability and stretched valuation are concerning. Considering these factors, it could be wise to avoid the stock now.
Stocks to Consider Instead of Advanced Micro Devices, Inc. (AMD)
The odds of AMD outperforming in the weeks and months ahead are significantly compromised. However, there are many industry peers with impressive POWR Ratings. So, consider these three A (Strong Buy) and B-rated (Buy) stocks from the <a href="https://stocknews.com/category/semiconductor-wireless-chip/">Semiconductor &amp; Wireless Chip</a> industry instead:
Photronics, Inc. (<a href="https://stocknews.com/stock/PLAB/">PLAB</a>)
ChipMOS TECHNOLOGIES INC. (<a href="https://stocknews.com/stock/IMOS/">IMOS</a>)
Renesas Electronics Corporation (<a href="https://stocknews.com/stock/RNECF/">RNECF</a>)
What To Do Next?
43 year investment veteran, Steve Reitmeister, has just released his 2024 market outlook along with trading plan and top 11 picks for the year ahead.
<a href="https://report.stocknews.com/sign-up/stock-market-outlook-2024/?formplacement=artbotad_smo24_rep%22">2024 Stock Market Outlook &gt;</a>

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AMD shares rose $2.46 (+1.39%) in premarket trading Monday. Year-to-date, AMD has gained 20.24%, versus a 2.55% rise in the benchmark S&amp;P 500 index during the same period.
<hr><div style="clear:both;"></div> <h2>About the Author: Dipanjan Banchur</h2> <img src='https:/wp-content/uploads/2021/11/Dipanjan-Banchur_headshots_3.jpg' style="float:left; padding:5px;width:125px;">Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master's degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets.<a href="https://stocknews.com/authors/?author=dipanjan-banchur">More...</a>The post <a href=https://stocknews.com/news/amd-plab-imos-rnecf-amd-earnings-watch-analyzing-potential-buy-moves/>AMD Earnings Watch: Analyzing Potential Buy Moves</a> appeared first on <a href=https://stocknews.com/>StockNews.com</a>

AMD Earnings Watch: Analyzing Potential Buy Moves

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