NEW YORK (TheStreet) -- Shares of Integrated Device Technology (IDTI) - Get Report were falling 5.3% to $24.65 on Thursday after the mixed-signal semiconductors developer announced a private offering of $325 million convertible senior notes.
Late Wednesday, IDT announced it will offer the $325 million aggregate principal amount of convertible senior notes due 2022 in a private offering to qualified institutional buyers.
The company said the conversion price, interest rate, and other terms of the notes will be determined in negotiations between IDT and the initial buyers. When issued, the notes will pay interest semi-annually and will mature on November 15, 2022 unless repurchased of converted before then.
IDT expects to use a portion of the net proceeds from the offering to repurchase shares of its common stock, and the rest for general corporate purposes.
The senior note offering announcement comes a few days after IDT reported its financial results for the second quarter of fiscal 2016.
TheStreet Ratings team rates INTEGRATED DEVICE TECH INC as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
We rate INTEGRATED DEVICE TECH INC (IDTI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. 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 revenue growth greatly exceeded the industry average of 13.1%. Since the same quarter one year prior, revenues rose by 23.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- IDTI has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 7.44, which clearly demonstrates the ability to cover short-term cash needs.
- Powered by its strong earnings growth of 75.00% and other important driving factors, this stock has surged by 68.42% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- INTEGRATED DEVICE TECH INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, INTEGRATED DEVICE TECH INC increased its bottom line by earning $0.74 versus $0.72 in the prior year. This year, the market expects an improvement in earnings ($1.23 versus $0.74).
- 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 193.7% when compared to the same quarter one year prior, rising from $14.44 million to $42.42 million.
- You can view the full analysis from the report here: IDTI