NEW YORK (TheStreet) -- Shares of Fairchild Semiconductor Intl. Inc. (FCS) are higher by 6.29% to $16.99 in mid-morning trading on Wednesday, following a Bloomberg report suggesting Infineon Technologies AG (IFNNY) is close to striking a deal to purchase a U.S.-based semiconductor company for almost $2 billion.
In a report published in July, Bloomberg said the largest chip maker in Germany could be eyeing Fairchild Semiconductor as a potential acquisition, the report also mentioned Power Integrations Inc. (POWI) , and Semtech Corp. (SMTC) as possibilities.
The potential billion dollar purchase could be announced as early as today, sources told Bloomberg.
Must Read: Warren Buffett's 25 Favorite Stocks
Stocks TO Buy: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn More.
Power Integrations stock is higher by 9.46% to $62.62, and shares of Semtech are up 8.09% to $25.25 this morning.Separately, TheStreet Ratings team rates FAIRCHILD SEMICONDUCTOR INTL as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation: "We rate FAIRCHILD SEMICONDUCTOR INTL (FCS) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook." Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 337.3% when compared to the same quarter one year prior, rising from -$7.50 million to $17.80 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.0%. Since the same quarter one year prior, revenues slightly increased by 4.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
- FCS's debt-to-equity ratio is very low at 0.16 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, FCS has a quick ratio of 2.22, which demonstrates the ability of the company to cover short-term liquidity needs.
- Net operating cash flow has significantly increased by 68.92% to $84.80 million when compared to the same quarter last year. In addition, FAIRCHILD SEMICONDUCTOR INTL has also vastly surpassed the industry average cash flow growth rate of -9.88%.
- 41.44% is the gross profit margin for FAIRCHILD SEMICONDUCTOR INTL which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, FCS's net profit margin of 4.79% significantly trails the industry average.
- You can view the full analysis from the report here: FCS Ratings Report
Check Out Our Best Services for Investors
Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts
Check Out Our Best Services for Investors
Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
Every recommendation goes through 3 layers of intense scrutinyquantitative, fundamental and technical analysisto maximize profit potential and minimize risk.
Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.