Short Interest In Marvell Tech Rebounds, In Altera Still Falling (ALTR, MRVL, MXIM)
Among the leading semiconductor stocks, Altera (NASDAQ: ALTR), Marvell Technology (NASDAQ: MRVL) and Maxim Integrated Products (NASDAQ: MXIM) saw the most significant swings in short interest between the April 15 and April 30 settlement dates.
Short sellers also retreated from Advanced Micro Devices, Intel, KLA-Tencor, Linear Technology, Micron Technology, Qualcomm, Texas Instruments and Xilinx in the final two weeks of the month.
But gains in short interest were seen at Applied Materials, ARM Holdings, Avago Technologies, Broadcom, Cirrus Logic, Lam Research, NVIDIA and STMicroelectronics during the period.
Below we take a closer look at how Altera, Marvell Technology and Maxim Integrated Products have fared and what analysts expect from them.
Short interest in this San Jose, California-based company decreased more than 29 percent to more than 3.65 million shares in the period. That was more than one percent of the float, as well as the lowest number of shares short since January, after declining for the past three periods.
Altera reported better-than-expected quarterly results in late April. The company has a market capitalization of more than $10 billion and a dividend yield near 1.9 percent. This S&P 500 component has a return on equity of about 16 percent and an operating margin that is better than the industry average.
More than half of the 27 analysts surveyed by Thomson/First Call recommend buying shares. Their mean price target, or where analysts expect the share price to go, is about 17 percent higher than the current share price. That consensus target is just shy of the 52-week high from last September.
The share price is down about six percent in the past month and currently well below the 50-day and the 200-day moving averages. The stock has not only underperformed the broader markets over the past six months, but competitors Linear Technology and Xlinx as well.
Short interest in this Bermuda-based company was more than 23 percent higher than in the previous period to 4.30 million shares, or a little over one percent of the float. But that was still less than half the 10 million of so shares short at the end of March. And the days to cover was about one.
This integrated circuits maker has a market cap of less than $8 billion and a dividend yield near 1.5 percent. Analysts are looking for more than 15 percent growth in revenue in the current quarter and the next. The company has a long-term earnings per share (EPS) growth forecast of more than 11 percent.
For at least three months, the consensus recommendation of analysts surveyed has been to hold Marvell Technology shares. Note that a move to their mean price target would be a gain of more than six percent for shareholders. That target also is less than the recent 52-week high.
Shares have traded mostly between $15 and $16 since mid-February, but they are up almost 16 percent from six months ago. The stock has outperformed not only the likes of Texas Instruments over the past six months, but the Nasdaq and the S&P 500 as well.
See also: Advanced Micro, ARM Holdings Ink Deal
Maxim Integrated Products
The number of shares sold short in this San Jose, California-based company slumped about 31 percent to almost 3.54 million shares in the final weeks of the month. That was more than one percent of the float, as well as the lowest level of short interest so far this year. The days to cover was more than one.
Better-than-expected EPS posted during the period resulted in at least two analyst upgrades. The company has a market cap near $9 billion and a dividend yield of about 3.2 percent. The price-to-earnings (P/E) ratio is less than the industry average. The return on equity is about 16 percent.
The consensus recommendation of the analysts polled is to hold shares, and it has been for at least three months. But they believe the shares have some head room, as their mean price target is more than 10 percent higher than the current share price. That consensus target would be a new 52-week high.
The share price is up more than 13 percent year to date, though shares have traded mostly between $31 and $33 since mid-February. The stock has outperformed competitor Analog Devices and the broader markets over the past six months, though it has underperformed STMicroelectronics.
At the time of this writing, the author had no position in the mentioned equities.
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