RF Micro Devices Inc. (RFMD) recently announced that LG has chosen RF Micro to provide various components for LG’s Optimus 4X HD and Optimus 3D Max smartphone devices. This would not only enhance the mobile phone and Wi-Fi component segments of RF Micro but also ossify its existing bonds with LG.
The company provides a PowerSmart component along with a Wi-Fi power component that supports the LG smartphones. These not only allow the mobile devices to be thinner in size but also reduce component complexity and cater to higher power output generation. LG’s new Optimus products are expected to be available internationally in 2012.
Management expressed its alacrity in this venture by averring that it is extremely appeased to further solidify its existing ties with LG. Furthermore, it is prescient about the far-reaching effects of these advanced technologies from its PowerSmart platforms that will most certainly ameliorate industry standards with time.
RF Micro remains proactive in catering to its offshore markets demands. On March 20, 2012, the company declared that it has successfully completed shipments of over 1 billion cellular power amplifiers (PAs) at various handset producing companies in Greater China. The company’s moves to augment its businesses at the ever-increasing Chinese economy are laudatory with regard to providing technologically advanced and cost-effective products to its vast clientele there.
The company should remain wary of progressive advances made by its competitors in the industry. I.D. Systems, Inc. (IDSY) recently announced that it was awarded orders from Toyota Engineering & Manufacturing North America, Inc. (:TEMA) for the deployment of its PowerFleet wireless Vehicle Management System (:VMS) at two of Toyota’s facilities in the U.S. Other ominous competitors include Elephant Talk Communications Inc. (ETAK) and Clearwire Corp. (CLWR).
We continue to maintain a Neutral recommendation on RF Micro. In the short run, our view is supported by a Zacks #3 Rank on the stock which translates into a short-term rating of Hold.
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