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Citi Launches Positive Catalyst Watch On NXP, ON; Negative On Intel

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  • Citi analyst Christopher Danely spent the last few weeks meeting with clients across the country and wanted to express his thoughts on sentiment and stocks.

  • He remained negative on semis but believed a short-term rally could continue through August, given near-term downside is understood. Investors were universally bearish on semis, but a large-scale collapse was not imminent.

  • He launched cheerful catalyst watches on NXP Semiconductors NV (NASDAQ: NXPIand ON Semiconductor Corp (NASDAQ: ON) in anticipation of good earnings and a short-term bounce in the group and a negative catalyst watch on Intel Corp (NASDAQ: INTC) due to downside to estimates for earnings.

  • Previously, Citi reiterated Neutral on Intel Corp INTC and Advanced Micro Devices, Inc (NASDAQ: AMD), betting on a contraction in the PC market to impact both negatively.

  • May marked the fifth consecutive month where notebook shipments were below expectations.

  • It cut the 2Q22E notebook shipments from down 3% Q/Q to down 11% Q/Q, well below seasonality of up 5%-10% Q/Q.

  • Intel reportedly looks to hike its processor prices after Taiwan Semiconductor Manufacturing Company Ltd (NYSE: TSM). It could force PC vendors to opt for advance purchases.

  • Rising production costs put pressure on chipmakers amid demand slowdown for smartphones and personal computers on market uncertainties fueled by inflation, the Ukraine crisis, and COVID-related lockdowns in China.

  • Photo by jonas-svidras via Unsplash

Latest Ratings for NXPI

Date

Firm

Action

From

To

Feb 2022

Needham

Maintains

Strong Buy

Feb 2022

Morgan Stanley

Maintains

Equal-Weight

Feb 2022

Raymond James

Maintains

Outperform

View More Analyst Ratings for NXPI

View the Latest Analyst Ratings

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