These 3 Semiconductor Stocks are Losing Ground Today

NEW YORK (TheStreet) -- Not all semiconductor stocks have had the luck of Cree (CREE) and Himax (HIMX) over Wednesday's session. Atmel Corporation (ATML), Advanced Micro Devices (AMD) and Semiconductor Manufacturing International (SMI) have each suffered losses over the day's trading.

By late afternoon, Atmel had taken off 3% to $8.56, Semiconductor Manufacturing International was off 2.9% to $4.78, and Advanced Micro Devices had plunged 11.5% to $3.69.

ATML Chart ATML data by YCharts

TheStreet Ratings team rates ATMEL CORP as a Hold with a ratings score of C. The team has this to say about their recommendation:

"We rate ATMEL CORP (ATML) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, increase in stock price during the past year and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has significantly increased by 53.22% to $82.06 million when compared to the same quarter last year. In addition, ATMEL CORP has also vastly surpassed the industry average cash flow growth rate of -24.53%.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • ATML, with its decline in revenue, slightly underperformed the industry average of 0.4%. Since the same quarter one year prior, revenues slightly dropped by 1.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 74.9% when compared to the same quarter one year ago, falling from $21.64 million to $5.43 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, ATMEL CORP's return on equity significantly trails that of both the industry average and the S&P 500.

TheStreet Ratings team rates SEMICONDUCTOR MFG INTL CORP as a Hold with a ratings score of C-. The team has this to say about their recommendation:

"We rate SEMICONDUCTOR MFG INTL CORP (SMI) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 0.4%. Since the same quarter one year prior, revenues rose by 15.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Powered by its strong earnings growth of 250.00% and other important driving factors, this stock has surged by 39.73% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • 46.55% is the gross profit margin for SEMICONDUCTOR MFG INTL CORP which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, SMI's net profit margin of 7.95% is significantly lower than the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.46, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. When compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, SEMICONDUCTOR MFG INTL CORP's return on equity is below that of both the industry average and the S&P 500.

TheStreet Ratings team rates ADVANCED MICRO DEVICES as a Sell with a ratings score of D+. The team has this to say about their recommendation:

"We rate ADVANCED MICRO DEVICES (AMD) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally high debt management risk."

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