9540

Analog Semiconductors Stocks Q2 Teardown: Sensata Technologies (NYSE:ST) Vs The Rest


Radek Strnad /
2022/09/21 3:08 am EDT
Add to Watchlist

As analog semiconductors stocks’ Q2 earnings season wraps, let's dig into this quarter’s best and worst performers, including Sensata Technologies (NYSE:ST) and its peers.

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 9 analog semiconductors stocks we track reported a decent Q2; on average, revenues beat analyst consensus estimates by 3.31%, while on average next quarter revenue guidance was 1.83% above consensus. There has been a stampede out of high valuation technology stocks as raising interest encourage investors to value profits over growth again and while some of the analog semiconductors stocks have fared somewhat better than others, they have not been spared, with share price declining 6.13% since the previous earnings results, on average.

Weakest Q2: Sensata Technologies (NYSE:ST)

Originally a temperature sensor control maker and part of Texas Instruments for 60 years, before eventually being spun out, 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 $1.02 billion, up 2.8% year on year, beating analyst expectations by 1.51%. It was a weak quarter for the company, with revenue guidance for both the next quarter and full year guidance missing analysts' expectations.

"Sensata delivered record revenue in the second quarter, with results in line with guidance despite significant market, supply chain, and foreign currency headwinds. Sensata’s organic revenue growth outpaced underlying markets by 650 basis points and we delivered growth from acquisitions of 280 basis points, offsetting end market declines compared to the prior-year quarter,” said Jeff Cote, CEO and President of Sensata.

Sensata Technologies Total Revenue

Sensata Technologies delivered the slowest revenue growth of the whole group. The stock is down 7.61% since the results and currently trades at $40.64.

Read our full report on Sensata Technologies here, it's free.

Best Q2: Monolithic Power Systems (NASDAQ:MPWR)

Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ: MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.

Monolithic Power Systems reported revenues of $461 million, up 57.1% year on year, beating analyst expectations by 7.06%. It was an exceptional quarter for the company, with a beat on the bottom line and a significant improvement in operating margin.

Monolithic Power Systems Total Revenue

The stock is down 10.7% since the results and currently trades at $412.

Is now the time to buy Monolithic Power Systems? Access our full analysis of the earnings results here, it's free.

Skyworks Solutions (NASDAQ:SWKS)

Result of a merger of Alpha Industries and the wireless communications division of Conexant, Skyworks Solutions (NASDAQ: SWKS) is a designer and manufacturer of chips used in smartphones, autos, and industrial applications to amplify, filter, and process wireless signals.

Skyworks Solutions reported revenues of $1.23 billion, up 10.4% year on year, in line with analyst expectations. It was a weak quarter for the company, with an underwhelming revenue guidance for the next quarter and an increase in inventory levels.

Skyworks Solutions had the weakest performance against analyst estimates in the group. The stock is down 13.3% since the results and currently trades at $98.46.

Read our full analysis of Skyworks Solutions's results here.

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 $3.31 billion, up 27.5% year on year, beating analyst expectations by 1.43%. It was a decent quarter for the company, with a significant improvement in operating margin but an increase in inventory levels.

The stock is down 7.65% since the results and currently trades at $160.99.

Read our full, actionable report on NXP Semiconductors here, it's free.

Texas Instruments (NASDAQ:TXN)

Headquartered in Dallas, Texas since the 1950s, Texas Instruments (NASDAQ: TXN) is the world’s largest producer of analog semiconductors.

Texas Instruments reported revenues of $5.21 billion, up 13.7% year on year, beating analyst expectations by 12.1%. It was a solid quarter for the company, with an impressive beat of analyst estimates.

Texas Instruments scored the strongest analyst estimates beat among the peers. The stock is up 3.18% since the results and currently trades at $165.97.

Read our full, actionable report on Texas Instruments here, it's free.

The author has no position in any of the stocks mentioned