Expect Multiple Tailwinds To Drive Maxim Integrated's Beat And Raise Quarter

Maxim Integrated Products, Inc. (NASDAQ: MXIM) is scheduled to report its fiscal Q3 2017 results on April 20.

Maxim reported an EPS and revenue beat in Q2. EPS came in at $0.46, versus the estimate of $0.44, while revenue came in at $551 million, versus the estimate of $542.69 million. Following these results, several analysts had raised their views on the company:

• Macquarie initiated coverage of the company with an Outperform rating.
• While maintaining a Buy rating, Drexel Hamilton raised the price objective from $46 to $52.00.
• Royal Bank of Canada upped their price objective from $40 to $45.
• Stifel Nicolaus increased the price target from $44 to $50, while maintaining a Buy rating.
• Jefferies upped the price target from $44 to $49, and reiterated a Buy rating.

Related Link: Maxim's PMIC Reduces Solution Size By 50% for Wearable Medical and Fitness Applications

Expectations for Q3

The Street expectations are for an EPS of $0.52 on revenues of $575.29 million. In a note Thrusday, Betsy Van Hees of Loop Capital said Maxim Integrated could report another quarterly beat, backed by “healthy demand in the automotive, communications & data center, and industrial end markets.”

With these tailwinds likely to continue into Q4, the company may announce better-than-expected guidance for the quarter. Naming Maxim Integrated as “one of our top mid-cap picks,” the analyst mentioned that the company appeared poised for continued sequential growth in earnings and revenue due to:

• Consumer diversification, beyond smartphones
• Increased market share gains
• Ongoing transformation in manufacturing

Van Hees reiterates a Buy rating on the company, while raising the price target from $50 to $51.