While there are still some obstacles to overcome, I'm encouraged by the fact that Atmel's latest maXTouch solutions have picked up new design wins and continues to gain momentum in "non-traditional" touch devices/products such as automotive applications. As much as I like Atmel's future prospects, I don't believe that the stock is cheap when compared to Qualcomm or Broadcom ( BRCM). However, when matched up with Texas Instruments, which trades at almost 17-times fiscal 2014 estimates, Atmel's forward P/E of 13 seems more attractive, given their respective business transitions.
I don't want to make this sound as if I'm beating up on Texas Instruments, though. I believe the company is heading in the right direction and I have complete faith in management's ability to execute the transition towards Embedded Processing. However, I just don't believe the company's current situation deserves the premiums the stock commands, not when gross margins are also on the decline. Accordingly, I would still be a seller here at $35 per share and above, and I would look to a better rebound potential in a company like Atmel, which is showing more promise. At the time of publication the author had no position in any of the stocks mentioned.Follow @saintssenseThis article was written by an independent contributor, separate from TheStreet's regular news coverage.