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Investing.com - NXP Semiconductors NV (NASDAQ:NXPI), a $57.67 billion market cap semiconductor company with a "GOOD" financial health rating according to InvestingPro, received a reiterated Hold rating and $210.00 price target from Stifel on Tuesday, following the company’s in-line quarterly results.
The semiconductor company reported second-quarter revenue of $2.93 billion, representing a 3.2% sequential increase and slightly outperforming Stifel’s estimate by 0.9%. Non-GAAP earnings per share came in at $2.72, exceeding both Stifel’s and Street estimates by $0.06 and $0.04 respectively, with all end markets performing essentially as expected. The company maintains healthy profitability with a 56.2% gross margin.
NXP generated strong quarterly free cash flow of $696.0 million, equivalent to 24% of revenues, while trailing twelve-month free cash flow increased to $1.98 billion, up $120 million sequentially. The company’s trailing twelve-month EBITDA was reported at $4.75 billion, compared to $4.89 billion in the previous quarter.
Net debt increased 7.4% sequentially to $8.31 billion, as free cash flow was offset by cash acquisitions, including TTTech Auto, and shareholder returns of $461.0 million. Net leverage stood at 1.75x, up from 1.58x in the previous quarter. Notably, InvestingPro analysis shows the company maintains strong liquidity with a current ratio of 2.08, indicating robust ability to meet short-term obligations.
NXP provided a slightly higher outlook for the current quarter, with a revenue midpoint of $3.15 billion representing a 7.7% sequential increase and 2.3% above Street estimates. The non-GAAP EPS midpoint of $3.10 exceeded Stifel’s estimate by $0.36 and Street expectations by $0.03. Based on InvestingPro’s Fair Value analysis, the stock appears fairly valued at current levels. Discover more insights and 6 additional ProTips for NXPI in the comprehensive Pro Research Report, available exclusively to subscribers.
In other recent news, NXP Semiconductors has reported several notable developments. The company completed its acquisition of TTTech Auto, a provider of safety-critical systems and middleware for software-defined vehicles. This acquisition aims to enhance NXP’s CoreRide platform by integrating TTTech Auto’s MotionWise safety middleware, addressing software and hardware integration challenges in next-generation vehicles. On the financial front, UBS raised its price target for NXP Semiconductors to $276.00, maintaining a Buy rating, reflecting a 10.4% increase from its previous target. Goldman Sachs also initiated coverage on NXP with a Buy rating and a price target of $276.00, noting the company’s significant revenue from the automotive sector. Cantor Fitzgerald reiterated its Overweight rating with a $250.00 price target, highlighting the company’s robust gross margins compared to its peers. These developments indicate a continued positive outlook from analysts despite potential challenges in the automotive sector.
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