2015-03-18 More M&A Coming Soon From The Semiconductors? (MXIM) | More M&A Coming Soon From The Semiconductors?
More M&A Coming Soon From The Semiconductors? (MXIM)
Notes: Maxim Integrated Products is a $10B diversified semiconductor company. Along with other semis like (CY) and (ATML), it too saw unusual call buying today (plus the 2,200 purchased earlier this month). This type of activity suggests to me there is likely to be another (FSL)/(NXPI) type merger coming soon and it very well could have (CY), (MXIM), or (ATML) involved since they are in the $3B-$10B range (Freescale has a $13B market cap currently). Maxim trades at a P/E ratio of 19.16x (June16 estimates), P/S ratio of 4.27x, and a P/B ratio of 4.56x. Growth is expected to come back to the company in FY16 to the tune of 27.7% earnings growth and 7.6% top line growth. Cash holdings and short-term investments have been hovering around the $1.4B mark in recent quarters, which is why they are able to pay a 3%+ dividend yield. The semiconductor ETF (SMH) has a 1.12% yield. On January 23rd, Jefferies Group raised their price target to $42 from $34 (beat Q2 EPS estimates by $0.03 the day before).
Maxim Integrated Products (MXIM) Options Trade Idea
Buy the (MXIM) Apr $37 call for $0.65 or better
Stop loss- None
1st upside target- $1.20
2nd upside target- $1.80
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