Semiconductor stocks were upgraded to "bullish" from "cautious" at JP Morgan on expectations that earnings estimates and gross margins may increase in the second half of this year.
"Utilization rates should bottom in the first quarter of 2007 due to the inventory correction and result in a bottoming of gross margins and earnings estimates," wrote JP Morgan analysts including Christopher Danely, who prefer Texas Instruments Inc over the two biggest computer chipmakers, Intel Corp and Advanced Micro Devices (AMD) Inc.
Texas Instruments, along with Microchip Technology Inc, Marvell Technology Group Ltd, Analog Devices Inc and Nvidia Corp, should "outperform" as their margins will either bottom out in the first quarter or continue to expand, the JP Morgan analysts wrote.
They added that investors should remain cautious on Intel and AMD because another inventory correction may occur in the personal computer component market due to "overly optimistic" expectations of PC demand during the first half.
Deutsche Bank also upgraded the sector yesterday, increasing its rating to "overweight" from "neutral."
Chip stocks initially rallied on Friday before erasing their gains after Micron Technology Inc said prices of memory chips used in consumer electronics may slide 40 percent this quarter.
Texas Instruments fell US$0.16 to close at US$30.92 in New York Stock Exchange composite trading. Microchip slipped US$0.24 to US$35.41, Marvell lost US$0.24 to US$18.31 and Analog fell US$0.20 to US$33.10. Nvidia declined US$1.73 to US$32.65. Intel slid US$0.33 to US$21.03 and AMD slipped US$0.23 to US$14.90.
SEMICONDUCTORS: The German laser and plasma generator company will expand its local services as its specialized offerings support Taiwan’s semiconductor industries Trumpf SE + Co KG, a global leader in supplying laser technology and plasma generators used in chip production, is expanding its investments in Taiwan in an effort to deeply integrate into the global semiconductor supply chain in the pursuit of growth. The company, headquartered in Ditzingen, Germany, has invested significantly in a newly inaugurated regional technical center for plasma generators in Taoyuan, its latest expansion in Taiwan after being engaged in various industries for more than 25 years. The center, the first of its kind Trumpf built outside Germany, aims to serve customers from Taiwan, Japan, Southeast Asia and South Korea,
POWERING UP: PSUs for AI servers made up about 50% of Delta’s total server PSU revenue during the first three quarters of last year, the company said Power supply and electronic components maker Delta Electronics Inc (台達電) reported record-high revenue of NT$161.61 billion (US$5.11 billion) for last quarter and said it remains positive about this quarter. Last quarter’s figure was up 7.6 percent from the previous quarter and 41.51 percent higher than a year earlier, and largely in line with Yuanta Securities Investment Consulting Co’s (元大投顧) forecast of NT$160 billion. Delta’s annual revenue last year rose 31.76 percent year-on-year to NT$554.89 billion, also a record high for the company. Its strong performance reflected continued demand for high-performance power solutions and advanced liquid-cooling products used in artificial intelligence (AI) data centers,
Gasoline and diesel prices at domestic fuel stations are to fall NT$0.2 per liter this week, down for a second consecutive week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) announced yesterday. Effective today, gasoline prices at CPC and Formosa stations are to drop to NT$26.4, NT$27.9 and NT$29.9 per liter for 92, 95 and 98-octane unleaded gasoline respectively, the companies said in separate statements. The price of premium diesel is to fall to NT$24.8 per liter at CPC stations and NT$24.6 at Formosa pumps, they said. The price adjustments came even as international crude oil prices rose last week, as traders
SIZE MATTERS: TSMC started phasing out 8-inch wafer production last year, while Samsung is more aggressively retiring 8-inch capacity, TrendForce said Chipmakers are expected to raise prices of 8-inch wafers by up to 20 percent this year on concern over supply constraints as major contract chipmakers Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) and Samsung Electronics Co gradually retire less advanced wafer capacity, TrendForce Corp (集邦科技) said yesterday. It is the first significant across-the-board price hike since a global semiconductor correction in 2023, the Taipei-based market researcher said in a report. Global 8-inch wafer capacity slid 0.3 percent year-on-year last year, although 8-inch wafer prices still hovered at relatively stable levels throughout the year, TrendForce said. The downward trend is expected to continue this year,
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