67 WALL STREET, New York - January 25, 2012 - The Wall Street Transcript has just published its Wireless Communications & Telecom 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, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: 4G LTE and 3G Infrastructure Upgrades - Wireless Carriers Compete for Spectrum - Smartphone Operating Systems - Emerging Markets Growth Shifts to Data ARPU
Companies include: TriQuint Semiconductor (TQNT); U.S. Cellular (USM); AT&Ts (T); America Movil (AMX); Apple (AAPL); and many more.
In the following brief excerpt from the Wireless Communications And Telecom Report, expert analysts discuss the outlook for the sector and for investors.
Craig Berger is a Managing Director in the technology, media and telecom equity research group of FBR Capital Markets Corp., covering the semiconductor components sector. Mr. Berger was named Forbes' number one blue chip semiconductor Analyst for 2010, number two in 2009, and he was named StarMine's number one semiconductor-earnings forecaster for 2010 and number three in 2009. Mr. Berger holds a BBA and an MPA from The University of Texas at Austin.
TWST: What is your coverage in the wireless space?
Mr. Berger: I cover a broad swath of semiconductor companies, including some in the communication semiconductor space. The companies I cover most exposed to cellular would be Qualcomm (QCOM), Broadcom (BRCM), Marvell (MRVL), and then you have NVIDIA (NVDA) and Texas Instruments (TXN) playing there a bit. Some of the other companies are exposed in other ways. For example, Atmel (ATML) sells touch controllers, Maxim (MXIM) sells power management chips, etc.
TWST: Who is best positioned right now?
Mr. Berger: Qualcomm is having a record and blowout year, and they are benefiting from a lot of smartphone business. Within the smartphone vendor space, you certainly have winners and losers. The losers have been RIM (RIMM) and Nokia (NOK). The winners have been Apple (AAPL) and Samsung (005930.KS), and to a lesser extent HTC (2498.TW), although HTC now looks like they may be turning from a winner into a loser based on headwinds.
That's on the device side.On the communications equipment side, Cisco (CSCO) has clearly had some challenges. Juniper (JNPR) has had some challenges, and that's probably because privately owned Chinese company Huawei is massive and huge and impacting the established guys of communications equipments businesses. So not everybody is doing well, not everybody is doing poorly. It's a mixed bag. On the chip side, we see winners in Qualcomm, Broadcom, NetLogic (NETL), Cavium (CAVM), LSI, Maxim and others.
TWST: Is 4G significant for the chip companies?
Mr. Berger: It's going to be significant to the cellular baseband providers, so Qualcomm, Broadcom, Intel (INTC) / Infineon (AFX.DE), STMicro (STM) and to a lesser extent Marvell. These are the companies that produce the main processor in the cell phone. This is called the baseband processor, so 4G is a significant shift because it has much faster upload and download speeds. You can transfer many more of bits and bytes of data over the cellular networks. Qualcomm stands to be the largest beneficiary within chips. You could see other folks benefit as well, specifically STMicro has a decent 4G solution, Intel/Infineon is working on it pretty hard, Broadcom is working on it, and then you could see some of the smaller radio frequency chip guys, some of the R.F. and power amplifier chip vendors benefit from 4G as you need more radios in each phone. Some of those companies could include Skyworks (SWKS), RF Micro Device (RFMD), TriQuint Semiconductor (TQNT), RDA Micro (RDA) or others.
TWST: Is this a good place to invest right now?
Mr. Berger: Qualcomm is a great wireless-chip firm to be exposed to right now. They have a strong franchise. They've got technology leadership in 4G. Obviously they have got patent and royalty income on every 3G and 4G device sold in the world. They also make chips for 3G and 4G phones, and they are ramping Apple iPhone and iPad devices, and that has been a bit of an incremental driver. Qualcomm didn't have the iPhone before, and they are now supplying into those devices, so that's a big slug of business that turned on for them in 2H11. Another wireless- and networking-exposed firm I really like right now is Broadcom. This stock has been highly unloved. It has been under significant pressure; it seems to have stabilized over the last month. But I think fundamentals are set to improve as you get into the middle of the year, and this stock is pretty widely hated among investors, so that's a good time to be buying because there is no froth embedded in the stock yet.
The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
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