ASML: Oddo's best pick in sector note
(CercleFinance.com) - Global semiconductor sales for March 2020 were released at the weekend by the World Semiconductor Trade Statistics (WSTS).
In smoothed data (3 month moving averages), they reached 34.9 billion dollars, slightly higher than Oddo's forecast of 33.6 billion dollars.
Analysts say that this is a new improvement, with growth of 6.9%, after 5.2% in February. In sequential terms, sales fell by 0.8%. Q1 2020 is therefore up 3% yoy and down 7% sequentially.
Analysts now expect a 10% drop in sales sequentially in Q2, with a more gradual recovery in Q3. They have nudged up their 2020 market forecast from -10% to -8%, with a low point in the summer.
Oddo says that it believes it has been too severe on Infineon (publication Tuesday, Reduce, forecast on average up 22%, with a target price of 14 euros against 12 euros) and Dialog (publication on Wednesday, Buy, forecast at +10%, target price of 44 euros against 40 euros), it says.
It is leaving its forecasts unchanged for Elmos (publication Wednesday, Neutral), which it believes are at the right level. ASML remains its top pick in the sector. It remains cautious on the exposure to the automobile sector, particularly Infineon, which has a 45% exposure to the automobile market.
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