Quinn Bolton, an analyst from Needham, reiterated the Buy rating on Silicon Motion (SIMO – Research Report). The associated price target is $75.00.
Quinn Bolton’s Buy rating for Silicon Motion Technology Corporation (SIMO) is based on a variety of factors. Firstly, he noted that mobile and PC inventory has mostly normalized, which has contributed to an increase in OEM order activity. Secondly, the management’s response to customer insourcing concerns and near-term opportunities with UFS 3.1 has made him confident in the company’s prospects.
Furthermore, Bolton is optimistic about the potential for gross margins to return to around 48% by the second half of 2025, despite tempering his gross margin estimate ramp. He also pointed out that three new products are expected to enter tapeout between the fourth quarter of 2023 and the second quarter of 2024, which could drive operating expenses approximately $5 million higher per quarter. Finally, he believes that a PC replacement cycle could spur overall unit growth, and that the current stock price does not fully account for potential upside from the arbitration with MXL.
In another report released today, Bank of America Securities also maintained a Buy rating on the stock with a $80.00 price target.
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Silicon Motion (SIMO) Company Description:
Silicon Motion Technology Corp. engages in the development, manufacture, and supply of semiconductor products for the electronics market. It offers embedded and expandable storage, radio frequency integrated circuits, and embedded graphics. The company was founded in November 2005 and is headquartered in Hong Kong.
Read More on SIMO:
- Silicon Motion Announces Results for the Period Ended September 30, 2023
- Silicon Motion Announces Annual Cash Dividend Payable Quarterly
- SIMO Earnings this Week: How Will it Perform?
- Silicon sees Q3 sequential revenue growth slightly above high end of guidance
- Silicon Motion Announces Preliminary Third Quarter 2023 Revenue and Earnings Conference Call Details
