The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Vishay Intertechnology (NYSE: VSH) and the rest of the analog semiconductors stocks fared in Q1.
Demand for analog chips is generally linked to the overall level of economic growth, as analog chips serve as the building blocks of most electronic goods and equipment. Unlike digital chip designers, analog chip makers tend to produce the majority of their own chips, as analog chip production does not require expensive leading edge nodes. Less dependent on major secular growth drivers, analog product cycles are much longer, often 5-7 years.
The 15 analog semiconductors stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 2.2% while next quarter’s revenue guidance was 0.9% above.
Luckily, analog semiconductors stocks have performed well with share prices up 10.5% on average since the latest earnings results.
Weakest Q1: Vishay Intertechnology (NYSE: VSH)
Named after the founder's ancestral village in present-day Lithuania, Vishay Intertechnology (NYSE: VSH) manufactures simple chips and electronic components that are building blocks of virtually all types of electronic devices.
Vishay Intertechnology reported revenues of $715.2 million, down 4.2% year on year. This print fell short of analysts’ expectations by 0.6%. Overall, it was a slower quarter for the company with a significant miss of analysts’ EPS estimates.
“Market signals, which continued from the fourth quarter, indicate that much of the channel inventory that overhung the market has normalized. We executed well during the first quarter on our strategic levers to drive faster revenue growth and improve profitability. We are prepared to navigate evolving tariff policies and any demand uncertainties, staying in close contact with our customers to assure them of reliable supply and making adjustments to our spending as necessary,” said Joel Smejkal, president and CEO.
Vishay Intertechnology delivered the weakest performance against analyst estimates of the whole group. Interestingly, the stock is up 5.3% since reporting and currently trades at $14.14.
Read our full report on Vishay Intertechnology here, it’s free.
Best Q1: Himax (NASDAQ: HIMX)
Taiwan-based Himax Technologies (NASDAQ: HIMX) is a leading manufacturer of display driver chips and timing controllers used in TVs, laptops, and mobile phones.
Himax reported revenues of $215.1 million, up 3.7% year on year, outperforming analysts’ expectations by 2.4%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and revenue guidance for next quarter exceeding analysts’ expectations.
The market seems happy with the results as the stock is up 14.7% since reporting. It currently trades at $8.56.
Is now the time to buy Himax? Access our full analysis of the earnings results here, it’s free.
NXP Semiconductors (NASDAQ: NXPI)
Spun off from Dutch electronics giant Philips in 2006, NXP Semiconductors (NASDAQ: NXPI) is a designer and manufacturer of chips used in autos, industrial manufacturing, mobile devices, and communications infrastructure.
NXP Semiconductors reported revenues of $2.84 billion, down 9.3% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a narrow beat of analysts’ adjusted operating income estimates but an increase in its inventory levels.
Interestingly, the stock is up 1.2% since the results and currently trades at $199.
Read our full analysis of NXP Semiconductors’s results here.
Analog Devices (NASDAQ: ADI)
Founded by two MIT graduates, Ray Stata and Matthew Lorber in 1965, Analog Devices (NASDAQ: ADI) is one of the largest providers of high performance analog integrated circuits used mainly in industrial end markets, along with communications, autos, and consumer devices.
Analog Devices reported revenues of $2.64 billion, up 22.3% year on year. This print surpassed analysts’ expectations by 5.2%. It was a very strong quarter as it also produced a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.
The stock is down 1.6% since reporting and currently trades at $218.51.
Read our full, actionable report on Analog Devices here, it’s free.
Sensata Technologies (NYSE: ST)
Originally a temperature sensor control maker and a subsidiary of Texas Instruments for 60 years, Sensata Technology Holdings (NYSE: ST) is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.
Sensata Technologies reported revenues of $911.3 million, down 9.5% year on year. This result topped analysts’ expectations by 3.5%. Overall, it was a strong quarter as it also recorded an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ adjusted operating income estimates.
The stock is up 20.2% since reporting and currently trades at $27.
Read our full, actionable report on Sensata Technologies here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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