Low-End Smartphones and Tablets Stronger Than Expectations, Especially in Emerging Countries: Expert Analyst Mark Li Shares Key Takeaways from Earnings Season

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: What have been some of the key takeaways from the first-quarter earnings season? What notable surprises have you heard in talks with management?

Mr. Li: I think the key theme I have, is the demand for smartphones and also tablets remains very strong, especially for those smartphones and handsets in emerging countries, so low-end smartphones, low-end tablets are stronger than expectations, and therefore many of the companies in my coverage actually guided very strong - much higher than typical seasonal increase from 1Q to 2Q. So I think overall that bodes well for continued growth, even in the second part of this year.

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...

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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