Low-End Smartphone and Tablet Market Expands, Companies Look for Continued Growth in Emerging Markets: Senior Research Analyst Mark Li Discusses Themes in the Semiconductor Sector

Wall Street Transcript

67 WALL STREET, New York - May 31, 2013 - The Wall Street Transcript has just published its Semiconductors Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Semiconductor Capital Equipment - Cloud Computing, Mobile Device Consumer Demand - Semiconductor Inventory Burnoff - Improvement from Cyclical Bottom - Semiconductor Capital Equipment Spending - New Computing Platform Demand

Companies include: Taiwan Semiconductor Manufactu (TSM), Advanced Semiconductor Enginee (ASX), Apple Inc. (AAPL), Semiconductor Manufacturing In (SMI) and many more.

In the following excerpt from the Semiconductors Report, an expert analyst discusses the outlook for the sector for investors:

TWST: Your target price for MStar presents lots of upside. What do you like about that stock, and what sets it apart from its peers in your mind?

Mr. Li: MStar (3697.TW) is somehow unique in a way. Their share price is not driven by its own performance, because the company announced a merger with another company I cover, MediaTek (2454.TW), more than a year ago, and therefore MStar's share price now is primarily driven by the expectation upon the approval of the merger and the share price of the acquiring company, MediaTek.

When MediaTek's share price goes up, MStar's share price normally will go up too, because people do expect the deal will go through, and MStar will be merged into MediaTek, so that's the primary reason why I have higher target price for MStar. Now, there is a gap between the price offered by MediaTek and the actual traded price of MStar, but I believe it presents a good arbitrary opportunity to long MStar and short MediaTek.

TWST: You've recently become more positive on MediaTek. What influenced your more positive view on the stock, and what is your outlook for the remainder of 2013?

Mr. Li: Yes, I indeed have turned more positive on MediaTek over the past three months. The merger with MStar is only one of main reasons, and I have other reasons, too. There are two most important reasons for me to turn more positive on MediaTek.

The first one is, as I mentioned earlier, low-end smartphones and tablets market is expanding quite quickly. On top of that, MediaTek is also gaining share in the market as well, so overall, together with expanding market size and also increasing market share, I do expect MediaTek will have a pretty good shipment increase this year and also very decent pricing as well. So, I think...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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