Let’s talk about Synaptics (SYNA).
I’ve mentioned this company before, it is number one in touch and fingerprint ID. Its recent acquisition of Renesas SP Drivers Inc. makes them number one in integrated circuits for LCD technology. The deal will immediately increase the company's addressable market by 150%. It also will strengthen business relationships the company already has, and be immediately accretive to non-GAAP earnings.
Here's the backdrop: Synaptics sells touchscreen chips to Samsung, and used to do business with Apple (AAPL). And Renesas is the sole display driver chip maker for iPhones. Not only does this bring Synaptics back into the Apple universe, but a chip merging the best strengths of the two companies would be huge.
In the most recent quarter, the company posted record revenue -- it erupted 43% for the full year, 37% for the quarter year-over-year. The real big deal was mobile, making up 77% of the business. Management announced a $200 million share buyback.
It’s a former high flyer, the wings were clipped, but it’s starting to come on really nice and strong. Because of volatility, it has higher-than-average risk, and may be why 38% of the float is short. Wall Street is betting big time against this. I think those shorts are making a mistake.
The shares aren't expensive, considering the 0.80 PEG and even forward PE of 14. It’s the second time I mentioned it, and it’s gone up a bit. North of $80, that’s where I think we are going to get a sure squeeze. My target before was $93, but now I'm starting to lean to this possibly being a $100 stock.
All opinions expressed by the host and participants of "Making Money with Charles Payne" are solely their current opinions and do not reflect the opinions of FBN, Fox News Network, LLC or their parent companies or affiliates, and may have been previously disseminated by Payne or the show participants. Payne's and the show participants' opinions are based upon information they consider reliable, but neither FBN, nor its affiliates and/or subsidiaries, nor any companies with which such participants are affiliated, warrant their completeness or accuracy, and they should not be relied upon as such. No part of Payne's or the show participants' (if applicable) compensation from FBN is related to the specific opinions they express.
Past performance is not indicative of future results. Neither Payne, the show participants, nor FBN guarantee any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment discussed on the show. Strategies or investments discussed may fluctuate in price or value.
Investments or strategies mentioned in this show may not be suitable for you and you should make your own independent decision regarding them. This material does not take into account your particular investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. You should strongly consider seeking advice from your own investment adviser.