Tag Archives: Taiwan Semiconductor

Is Texas Instruments Destined for Greatness?

By Alex Planes, The Motley Fool

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Investors love stocks that consistently beat the Street without getting ahead of their fundamentals and risking a meltdown. The best stocks offer sustainable market-beating gains, with robust and improving financial metrics that support strong price growth. Does Texas Instruments fit the bill? Let’s take a look at what its recent results tell us about its potential for future gains.

What we’re looking for
The graphs you’re about to see tell TI‘s story, and we’ll be grading the quality of that story in several ways:

  • Growth: are profits, margins, and free cash flow all increasing?
  • Valuation: is share price growing in line with earnings per share?
  • Opportunities: is return on equity increasing while debt to equity declines?
  • Dividends: are dividends consistently growing in a sustainable way?

What the numbers tell you
Now, let’s take a look at TI‘s key statistics:

TXN Total Return Price data by YCharts.

Passing Criteria

3-Year* Change 

Grade

Revenue growth > 30%

23%

Fail

Improving profit margin

(59.1%)

Fail

Free cash flow growth > Net income growth

54.4% vs. 18.9%

Pass

Improving EPS

31.3%

Pass

Stock growth (+ 15%) < EPS growth

40.4% vs. 31.3%

Pass

Source: YCharts.
*Period begins at end of Q4 2009.

TXN Return on Equity data by YCharts.

Passing Criteria

3-Year* Change

Grade

Improving return on equity

0.2%

Pass

Declining debt to equity

61.7% (since Q2 2011)

Fail

Dividend growth > 25%

75%

Pass

Free cash flow payout ratio < 50%

28.1% 

Pass

Source: YCharts.
*Period begins at end of Q4 2009.

How we got here and where we’re going
Most mature companies struggle to earn passing grades on many of these growth tests, but TI puts in a solid showing, earning six out of nine possible passing grades. The only real failing in the company’s progress is a deteriorating profit margin. Can TI push that margin higher by the time we examine it next year? Let’s dig a bit deeper into the company’s potential in 2013.

We know one area that won’t offer TI any potential for growth this year: mobile. That’s because the chipmaker made a high-profile decision to stop developing for the space last year, citing the fact that many large customers were beginning to produce chip designs in-house. According to Foolish tech analyst Evan Niu, that may have been the right choice. Samsung has long developed most of its chips in-house, and other major mobile makers (say that five times fast) either are doing the same, or soon will. Licensing ARM Holdings‘ reference designs, tweaking them for efficiency, and outsourcing the fabrication to Taiwan Semiconductor seems to be the order of the day. Where does that leave TI?

TI seems to be doing all right focusing on what it knows. One thing it’s been good at is developing simple Wi-Fi chips that are ideal for use in the nascent industrial Internet, a project spearheaded by General Electric but supported …read more

Source: FULL ARTICLE at DailyFinance

ARM and Taiwan Semiconductor: New Mobile Chip Ready for Mass Production

By Evan Niu, CFA, The Motley Fool

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British chip designer ARM Holdings and contract chip manufacturer Taiwan Semiconductor today announced the first “tape-out” of a Cortex-A57 processor on TSMC‘s FinFET process technology. A tape-out indicates completion of the initial processor design and shows that a chip is ready for mass production.

The Cortex-A57 is a high-performance 64-bit processor that will inevitably find its way into mobile devices. The Cortex-A57 is one of the first 64-bit processor designs from ARM. ARM and TSMC have been collaborating on development to optimize ARM‘s newest processor series on TSMC‘s 16-nanometer FinFET process.

The new chips are expected to deliver dramatic performance improvements alongside power efficiency gains.

 
 

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The article ARM and Taiwan Semiconductor: New Mobile Chip Ready for Mass Production originally appeared on Fool.com.

Fool contributor Evan Niu, CFA, has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance

Will Intel Become a Mobile-Computing King?

By Steve Heller, The Motley Fool

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Although Intel may be showing up fashionably late to the smartphone and tablet party, the party has only just begun. To date, the world has reached about 25% smartphone penetration and the tablet market is expected to grow to about half the size of the PC market this year.

Despite this relatively low saturation, these two industries have experienced explosive growth, which has put pressure on the PC industry, an area where Intel remains heavily entrenched. Last year marked the first time in over 12 years that the PC industry witnessed a decline in overall shipments. In order for Intel to defend itself against the mobile computing assault, it must develop compelling products that find their way into millions upon millions of mobile devices. Intel has only begun its big push into the mobile computing world, and it should continue benefiting from the fact it owns the world’s most technologically advanced semiconductor foundries. If all goes to plan, Intel’s bleeding-edge manufacturing processes will ultimately carry the weight, helping secure its future in our increasingly mobile world.

Processor agnostic
The beauty of mobile computing compared to PC computing is that there’s less rigidity in terms of what chip architecture can be used. Although ARM Holdings‘ architecture is currently dominating Intel in mobile computing applications, Google Android still gives Intel the opportunity to implement its PC-based x86 architecture. Ultimately, this processor-agnostic approach allows the market to decide which chip architecture is best suited for the task at hand.

2014 and beyond
The ARM versus Intel battle will really come to a head next year because it’ll be when Intel will begin delivering 14-nanometer chip designs. At that time, Intel is expected to have a two- to three-year lead over Taiwan Semiconductor because TSMC will only be at 20-nanometers and a generation behind on its FinFET technology, which integrates the use of 3-D transistors. In other words, the next two to three years give Intel a unique opportunity to show how its chips can theoretically be more power efficient thanks to better foundry processes.

Since Intel’s chips were originally designed for power and not efficiency, Intel’s success in mobile computing largely comes down to how efficient it can make its chips. If Intel can make a more powerful and more efficient chip than what ARM‘s licensees can produce, it will surely threaten ARM‘s current stronghold in the mobile computing market. As the next few years unfold, let’s not jump the gun and count Chipzilla out of the running yet.

When it comes to dominating markets, it doesn’t get much better than Intel’s position in the PC microprocessor arena. However, that market is maturing, and Intel finds itself in a precarious situation longer term if it doesn’t find new avenues for growth. In this premium research report on Intel, our analyst runs through all of the key topics investors should understand about the chip giant. Click here now to …read more
Source: FULL ARTICLE at DailyFinance

Is NVIDIA's Mobile Graphics Greatness at Risk?

By Alex Planes, The Motley Fool

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NVIDIA had better watch its back — a new high-tech collaboration is threatening to undermine the chip maker’s dominance in mobile graphics.

Yesterday, Taiwan Semiconductor and British chip designer Imagination Technologies agreed to work together to design 3-D transistors based on Imagination’s PowerVR graphics processors. Imagination already has its Samsung-built PowerVR chips in most of Apple‘s mobile devices, as well as in Apple TV, and has also gained placement in a number of Samsung devices as well. The next-gen PowerVR chips are expected to use a 16-nanometer transistor width, which is nearly half the size of NVIDIA‘s current 28-nanometer process, which will run at least through the end of this year.

Intel also makes use of the PowerVR architecture in some of its devices, and both the chip maker and Apple hold stakes in Imagination. Intel first developed 3-D transistors, which are manufactured with FinFET technology, two years ago, and is slated to drop down to a 14-nanometer transistor width this year. Using the new PowerVR chips in conjunction with its own optimized mobile offerings could provide Intel with a slim edge over ARM Holdings in the mobile space, and could also hold off NVIDIA, which plans to continue using an optimized system-on-a-chip design combining both central processing and graphics on its upcoming Tegras.

The only upside here for NVIDIA and other ARM-focused chip makers is that Taiwan Semiconductor hasn’t offered a release date for the FinFET PowerVR chips. A year or two might be enough of a lead to keep Intel and Imagination on the fringes, thus minimizing interest from mobile device makers (and app developers) that would put the ARM architecture completely beyond challenge.

NVIDIA was ahead of the curve launching its mobile Tegra processor, but investing gains haven’t followed as expected, with the company struggling to gain momentum in the smartphone market. The Motley Fool’s brand-new premium report examines NVIDIA‘s stumbling blocks, but also homes in on opportunities that many investors are overlooking. We’ll help you sort fact from fiction to determine whether NVIDIA is a buy at today’s prices. Simply click here now to unlock your copy of this comprehensive report.

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Source: FULL ARTICLE at DailyFinance

No, Apple Hasn't Hooked Up With Taiwan Semiconductor… Yet

By Evan Niu, CFA, The Motley Fool

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Last weekend, the Apple enthusiasts over at MacRumors tore open one of the new Apple TV units, which has recently received a quiet and slight internal upgrade. What they found inside was an A5 processor similar to the predecessor, except that it was significantly smaller.

That fact led to some speculation that perhaps Apple had at long last begun its transition away from Samsung as a foundry partner and perhaps got together with Taiwan Semiconductor and used its 28-nanometer manufacturing process. I had previously mentioned that definitive confirmation for or against this theory would have to await analysis from “specialists like Chipworks.” Never one to pass up a good silicon-identification challenge, Chipworks has stepped up to the task.

Die size comparison using the polysilicon from the prior gen A5 (left) with the top metal from the current gen A5. Source: Chipworks.

Sadly, there were no markings to indicate that the shrunken A5 hailed from Taiwan Semiconductor‘s plants. In fact, the evidence points toward Apple’s continued use of Samsung’s 32-nanometer process, meaning there was no change in the process. Instead, the reduced size was attributable to a new design instead of a process shrink.

Previous generations had a dual-core A5 recycled from other devices but simply had one core disabled, but Apple has now removed the unused core altogether, among other changes. That helped get the overall size down.

Another notable change is the addition of a newer Broadcom Wi-Fi combo chip. The chip is the BCM4334, an upgrade from the BCM4330 used in the last generation model. That change has allowed Apple to simplify the design into a one-antenna solution as opposed to the previous two antennas that were used. This arrangement is essentially how Apple now implements short-range radio transmissions in all of its latest iDevices, including the iPhone 5.

For now, Apple’s still sticking with Samsung.

There is a debate raging as to whether Apple remains a buy. The Motley Fool’s senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.

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Source: FULL ARTICLE at DailyFinance