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NXP Semiconductors (NXPI) Gains But Lags Market: What You Should Know

Zacks Equity Research
·3 mins read

In the latest trading session, NXP Semiconductors (NXPI) closed at $119.83, marking a +0.56% move from the previous day. This move lagged the S&P 500's daily gain of 1.6%. Meanwhile, the Dow gained 1.34%, and the Nasdaq, a tech-heavy index, added 2.26%.

Coming into today, shares of the chipmaker had lost 5.47% in the past month. In that same time, the Computer and Technology sector lost 5.8%, while the S&P 500 lost 5.3%.

Investors will be hoping for strength from NXPI as it approaches its next earnings release. In that report, analysts expect NXPI to post earnings of $1.10 per share. This would mark a year-over-year decline of 54.55%. Meanwhile, our latest consensus estimate is calling for revenue of $2 billion, down 11.6% from the prior-year quarter.

NXPI's full-year Zacks Consensus Estimates are calling for earnings of $4.83 per share and revenue of $7.97 billion. These results would represent year-over-year changes of -46.33% and -10.18%, respectively.

Investors should also note any recent changes to analyst estimates for NXPI. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. NXPI is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note NXPI's current valuation metrics, including its Forward P/E ratio of 24.7. This valuation marks a discount compared to its industry's average Forward P/E of 31.23.

We can also see that NXPI currently has a PEG ratio of 2.47. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. NXPI's industry had an average PEG ratio of 2.29 as of yesterday's close.

The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 129, putting it in the top 50% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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