Gainers In The World Of Semiconductors With The SAMSUNG ELECT LTD(F)(OTCMKTS:SSNLF) Galaxy S6


As SAMSUNG ELECT LTD(F) (OTCMKTS:SSNLF) and Apple Inc. (NASDAQ:AAPL) continue their smartphone fight, some chipmakers are expected to see huge gains in revenue and earnings. Samsung recently unveiled its Galaxy S6 smartphone, a device that is already receiving positive reviews from carriers and technology analysts. It remains to be seen whether the Galaxy S6 will overcome the iPhone 6 series that is already smashing sales records. However, in a new analysis report, JPMorgan Chase & Co. (NYSE:JPM) looked at a number of semiconductor companies, their association with Samsung and Apple, and their potential to gain from the massive smartphone war.

Broadcom

Broadcom Corporation (NASDAQ:BRCM) supplies chips to both Apple and Samsung, but the launch of the Galaxy S6 creates a new opportunity for the chipmaker. The company is expected to supply GPS, Wi-Fi and a host of other chipsets for the S6 smartphone. Broadcom is behind the touch-screen control chips in the iPhone 6 as well. JPM analysts have a $55 target price on the chipmaker, compared to a consensus target price of $47.61. The company pays a dividend of 1.2%.

Maxim

Maxim Integrated Products Inc. (NASDAQ:MXIM) is another semiconductor company with exposure to both Apple and Samsung. The company’s chipsets are used in a wide range of industries including automotive, industrial, communications and computing. Maxim is expected to be behind the power management and audio amplifier chips in the S6 device. The company already supplies these kinds of chips for Galaxy S5 devices, and the addition of S6 will bring in significant incremental revenue. As for Apple, Maxim is expected to supply power management chips for the Apple Watch. JPM issued a $40 price target on the stock of the chip company compared to the consensus estimate of $35.17. Maxim pays shareholders a 3.3% dividend.

Texas Instruments

Samsung has included a wireless charging capability in the S6 device, and Texas Instruments Incorporated (NASDAQ:TXN) is believed to be behind the chip. The JPM analysts expect the company to tap significant revenue from supply wireless charging chips for the S6 smartphone. The analysts issued a $65 target price on the stock versus the consensus estimate of $57.41. Texas pays a 2.3% dividend.

Audience

Audience Inc (NASDAQ:ADNC) is another small cap chipmaker that stands to benefit from the release of the S6. The company is expected to supply both hands-free and hands-on voice recognition chips for the S6 smartphone. Audience could also be involved in the supply of such chips for the soon coming Galaxy Note 5 device. The chipmaker received a $10 target price from JPM compared to a $5.25 consensus estimate.

Neha Gupta

Neha Gupta has been in the financial space for over six years now. Gupta earned her MBA degree from Symbiosis Centre of Distance Learning in 2009 and her passion for finance led her to pursue Chartered Financial Analyst (CFA) course. She has successfully completed Level II of her CFA. She is a veteran in article writing, which is depicted in her numerous pieces published on SeekingAlpha, Nextiphonenews, InsiderMonkey, MarketWatch, and Techinsider. Her crisp and eloquent writing finds its best place in Researchcows, where emphasis is given on developing rich content for various websites, products, business plans, trainings, and book writing.

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