Wall Street analysts see M&A continuing in the semiconductor sector as the industry matures. Two research firms chose their main M&A targets from semiconductor stocks on Wednesday.
Susquehanna Financial Group analyst Christopher Rolland identified three semiconductor stocks as acquisition targets based on their strategic and financial value.
“After a robust decade of mergers and acquisitions in which industry consolidation averaged 10% to 15% per year, the rate has slowed so far to about 8% in 2020 and just 4% in 2021,” Rolland said in a statement. note to customers. “Strong valuations and heightened regulatory concerns may have deterred interest, but consolidation is alive and kicking.”
Semiconductor stocks in the game
He rates Knowles stocks and Semtech stocks as neutral and Cirrus Logic stocks as positive.
Rolland called Knowles his “top contender” among semiconductor stocks. The Itasca, Illinois-based company is the dominant global player in microphone MEMs or micro-electromechanical systems. Knowles has adjacent capacitors and other precision components.
Semtech is his number 2 choice. The Camarillo, California-based company is best known for making LoRa chips. LoRa, short for ‘long range’, is an energy-efficient wireless technology for Internet of Things applications.
Austin, Texas-based Cirrus Logic, its number 3 pick, makes audio chips.
Elsewhere on Wall Street Wednesday, KeyBanc Capital Markets identified five potential takeover targets among semiconductor stocks. They contain Ambarella (AMBA), Grid Semiconductor (LSCC), Marvell technology (MRVL), Silicon Laboratories (PLATE) and synaptic (SON).
“We expect competitive pressures to continue to drive consolidation as companies look to compete at scale,” KeyBanc analyst John Vinh said in a note to customers.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories about consumer technology, software, and semiconductor stocks.
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