Semiconductor stocks have been on fire in 2017, and Q2 earnings season could be another good one for investors. However, with stock valuations already extremely stretched, investors may need to be selective about which semi stocks they own.
In a new earnings preview out on Tuesday, Barclays analyst Blayne Curtis said he expects a positive overall Q2 earnings season for semiconductor stocks but warned investors that some popular names may underperform.
“The Semiconductor group continues to grind higher, and we expect a 6th consecutive positive earnings period as most end markets remain healthy and we see largely better results/guidance,” Curtis wrote.
Despite his overall optimism, Curtis downgraded Advanced Micro Devices, Inc. AMD 1.2%and Cirrus Logic, Inc. CRUS 2.11% from Equal-Weight to Underweight and maintained an Underweight rating on Integrated Device Technology Inc IDTI 0.5% as well.
But even though some stocks have become overheated at this point, Barclays still sees buying opportunities ahead of Q2 earnings season as well. The firm upgraded Cavium Inc CAVM 1.11% and Cypress Semiconductor Corporation CY 0.14% from Equal-Weight to Overweight. Curtis especially likes Cavium’s recent business trends, including new product launches and QLCC share gains.
For Cypress, ne noted the stock’s relatively appealing valuation and its high likelihood of a major Apple Inc. AAPL 0.7% win.
In addition to Cypress and Cavium, Barclays maintains…
Click here to continue reading
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
