- Mizuho hosted its quarterly mobile phone industry call to review the state of the global mobile phone supply chain amid escalating geopolitical risks and deteriorating macroeconomic conditions.
- Analyst Vijay Rakesh listed his key takeaways.
- The inventory of handset components has been more than double the standard as distribution channels remain tight.
- China’s demand was weaker ahead of the Oct. 16 party congress.
- The weaker than expected base apple inc AAPL Demand for the iPhone 14 could extend the industry’s recovery time to 2H23E.
- Qualcomm Inc QCOM could see pricing pressures (though offset by gains at Samsung).
- They lowered forecast C22E 5G units to ~595 million, up ~8% yoy (previously: 600 million, up ~9% yoy), on weak demand.
- Looking at a possible 2023E recovery in mobile phones, he saw Broadcom Inc AVGOQCOM and Skyworks Solutions, Inc SWKS as best positioned with a better long-term roadmap and broader competitive moats.
- He saw AVGO (Obtain; Price target $725) well positioned with opportunities into 2022E with 5G and ASIC ramps and a strong position in wired infrastructure and enterprise storage.
- He believes the software segment could provide further operational leverage and drive an even stronger FCF.
- He believed QCOM (Obtain; Price target $175) is well positioned in the smartphone market as a technology leader with a long-term focus on 5G and expansion into new markets in RF and Auto.
- He saw SWKS (Obtain; price target $150) well-positioned for upcoming 5G ramps around the globe, driven by strong iPhone, Korean OEM stock gains, Chinese OEM traction and a significant $50-$100 increase in RF content per handset compared to 4G.
- SWKS also has opportunities in its broad market business, with growth in the IoT, auto and industrial sectors, which it believes can improve SWKS’ gross margin towards its 53% target.
- Price promotion: AVGO shares traded 5.02% lower at $437.39 on the last check Monday.
© 2022 Benzinga.de. Benzinga does not provide investment advice….
[ad_2]
Source story
