While other chipmakers are floundering, Microsemi Corp. is holding its own.
The Irvine-based company has managed to keep investors fairly happy with healthy profit margins and solid sales in the midst of an increasingly tough chip market.
“It’s a defensive play, strategically,” said Michael Davies, an analyst with Next Generation Equity Research LLC.
Microsemi sells to companies in an unusually high number of sectors for a chipmaker its size,$1.6 billion in market value at recent check. And it tends to do well in markets where there isn’t much competition, analysts said.
Microsemi, which was founded in 1960, makes chips that power satellites, military aircraft, medical equipment and flat-screen televisions, among other things.
Microsemi makes chips at its own factories, unlike other Orange County companies such as Irvine-based Broadcom Corp. and Newport Beach-based Conexant Systems Inc., which outsource manufacturing.
Microsemi is a “safe haven for chip investors,” said Craig Berger, an analyst with Wedbush Morgan Securities Inc., in a report.
The company has seen its shares fall about 10% during the past three months,similar to Nasdaq’s drop. But that’s better than the Philadelphia Semiconductor Index, a broad measure of chip stocks, which has fallen about 20% during the period.
Some chip stocks have fared much worse. Shares of Conexant and Newport Beach-based Mindspeed Technologies Inc. have fallen by mroe than 50%.
For more on this story, see the Aug. 14 edition of the Business Journal.
