He was also correct in saying these stocks would bottom long before anyone realized the problems were over. I think he is right about that because they appear to be close to bottoming if not already bottomed. Sometimes he is like Captain Obvious. Anyone who listened to these calls knows exactly what segments are seeing trouble and which are going strong.
I think QRVO is overdone. I went over their earnings. Yes, their management isn't awe inspiring like SWKS or NXPI, but it is hard to mess up one of the greatest secular bull trends in modern history. Their whole problem was the 4G infrastructure business for the build out of base stations. NXPI told us today the story behind this slowdown is related to some legal investigation in that sector in China by the government. Companies pulled back spending in fear of the investigation. They also told us demand was very strong and these same customer couldn't wait long before making capital purchases forced by the growing demands. They felt this slowdown would be over in a short period of time. If that is true, then QRVO could really bounce back with a vengeance after it shakes out for a while. I have learned a long time ago you cant day trade against big money with computers.
I wasn't disappointed. Reason was the market got it wrong not the company. The big thing I try to stress when picking a stock is to not develop a bias. So many people make up and idea about a company then go about trying to prove it. What I like to do once I have finished my research on a company is then attack that research like a short seller might to try to break it down. It is a unique approach but only the best companies will hold up to such scrutiny.
That was the first thing I pointed out for NXPI yesterday. The expectations where higher then what NXPI had promised. Luckily, NXPI is a top operator and delivered even on those high expectations.
You have to limit the number of positions you have based on the time you have to do the proper research and following of a company. For me, I am retired and can follow 10 companies if I want cause I have all time in the world. I own 6 companies at the moment because I insist on only owning the absolute best in each industry I like. That is something you should look at. I know I have said it before but I never sell a company unless I find something better. You always have to be asking yourself, "Is there a better company out there for the story I want to play?" For example, VDSI. I don't want to sound harsh, but if I were looking for a cyber security play, I could find 2 or 3 companies that have better stories and management. Sometimes it is hardest to be your own critic. Hold yourself accountable for Why you bought. I think your right on SYNA, but I just don't know it well enough.
SWKS lives in its own perfect world. I really mean that. It is just too good to sound true. That is exactly what happened. When everyone was scared and Aldrich told a tale too good to be believed, they sold. Nothing against SWKS because it is not their fault there are just killing it.
Hey Lily, This happens a lot. I have said this before. Analysts get swept up in the emotion too. You have to keep a close eye on analysts estimates compared to what a company promises. I saw this happen in CELG going into Q1 estimates were 20 cents higher then what the company promised. Well that cant end well. They you have a disappointment. The stock goes through a period of hate and loathing as analysts bubbles get popped.
I like Rick Clemmer. He is a no BS kind of guy. He really tells it like it is and pulls no punches. I think many like his straight shooter attitude because when he says, "its soft but its only going to last a short time." people really believe him. Just by saying that people could easily say, "OK my fears were warranted, but Rick says it will pass." That makes people feel better.
NXPI wasn't weak guidance Mike. When you back out the 50 mil in revenues from the divested high power RF business it was actually a beat on forward guidance. I think QRVO's pain is now turning into SWKS's gain. Shareholders are finally realizing not all 4 horsemen are created equal and their leaving QRVO to go into SWKS. QRVO risks there being only 3 horsemen just on the fact its management is weak.
Only company I have owned longer then SWKS and like more is my CELG. Given it has had a big run, you would have to wait for a bit more pull back. Depends on if you want to stay just in tech.
At a time such as this I want to stick with the best of the best with management I trust. That leaves NXPI and SWKS. If AVGO were more like NXPI and SWKS, I would say go for it the read through is in your favor, but AVGO is it own critter.
Where I had one of my stock up big in a single day and I had absolutely no desire to take a profit. Maybe I am not such a trader after all lol. I just cant help thinking that $150 is coming and no way I giving it up for a 7% pop.
The moat comes from the design. SWKS said a few times now that they are in the design phase with their customers when they develop these products. When they are able to provide more products across a customers needs, they win content. It is easier for a customer to use one supplier to fit more of their needs then to use many customers who's products might not be compatible with each other. That is why they are rapidly expanding the amount of content they can offer across an electronic device.
I think so. I know earnings shook many people with the IPhone number. I got the take that Apple slacked off a bit on the older IPhone 6 and 6 Plus due to the new 6s coming in September. I think Apple wants to shorten the supply of IPhones going into the 6s launch to drive up demand so they can post some sweet numbers. That is just my take though. On valuation, you just can beat Apple's valuation, huge cash hoard and decent dividend.
On the content question. The content for a device such as a thermostat wont need as much content because it doesn't have to be 4G to communicate. The content can go up for SWKS in these product though, as it is in set top boxes, because SWKS offers more then just the RF chips. They are now getting into power management and other areas of the device.
Break it down to how electronic IoT devices work. NXPI is big into the SOC (system of a chip) fancy term for a mini computer that runs a device. NXPI also excels at NFC (Near Field Communication) which allows 2 devices to communicate over short distances up to about 100 yards or so. SWKS allow a device to speak to the outside world via a cell phone or Satellite signal. For something like a smart meter for say your house's electric. NXPI would have the computer chip that monitors your power consumption while a SWKS chip would send that information back to your power company to monitor and bill you. Same concept works for many devices. The difference is what the device needs to communicate with. Within a factory, Inside a car, or to a Cell tower or Satellite.
I know in the earnings release there was a statement from Samsung went something like. Our missteps with our G6 has allowed competitors like Xiaomi take market share in China. I paraphrased it best I could remember. They did single out Xiaomi in their statements this morning.