For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
Another factor that can influence investors is FOMO, or the fear of missing out, especially with tech giants and popular consumer-facing stocks.
What if you'd invested in Maxim Integrated Products (MXIM) ten years ago? It may not have been easy to hold on to MXIM for all that time, but if you did, how much would your investment be worth today?
Maxim Integrated Products' Business In-Depth
With that in mind, let's take a look at Maxim Integrated Products' main business drivers.
San Jose, California based Maxim Integrated Products, Inc. is an original equipment manufacturer (OEM) of semiconductor analog and mixed signal integrated circuits (ICs).
The company has a broad product portfolio that includes analog-to-digital converters, amplifiers and comparators, communications devices, data converters and management components, sensors and wireless products.
Maxim’s 70+ product lines are primarily sold in the consumer, computing, industrial, automotive (formerly part of the Industrial segment) and communications markets which are the five primary end markets.
Its products have very extensive application in consumer goods like cordless phones, digital cameras and PDAs; data processing; industrial products; instrumentation products; medical instruments; and various communications gear and networking equipment.
The company's products are sold in major five end-markets namely automotive, communications and data center, computing, consumer and industrial markets.
A significant percentage of the wafer manufacturing continues to be carried out at Maxim’s three fabrication facilities, although increasing amounts are being outsourced to partner foundries — Epson, Powerchip and Maxchip.
The company has operations in the Asia/Pacific region, the U.S. and Europe. In fiscal 2020, the major part of total revenues came from China which accounted for 35% and the rest of Asia contributed 33%. The Europe and U.S. generated 18.5% and 11%, respectively. The rest of the world generated 2.5%.
Products are distributed in the U.S. and Canada through a direct sales force and support system. Products are sold through direct sales, applications organization and unaffiliated distributors.
Avnet was the primary global distributor, accounting for around 22% of the company’s revenues. Samsung, the only customer generated 10% of revenues alone.
Bottom Line
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in Maxim Integrated Products a decade ago, you're probably feeling pretty good about your investment today.
According to our calculations, a $1000 investment made in May 2011 would be worth $3,613.41, or a 261.34% gain, as of May 21, 2021. Investors should keep in mind that this return excludes dividends but includes price appreciation.
The S&P 500 rose 211.95% and the price of gold increased 19.30% over the same time frame in comparison.
Analysts are anticipating more upside for MXIM.
Maxim reported strong fiscal third-quarter results wherein both earnings and revenues grew on a year-over-year basis. Strength across all end markets served, including consumer, automotive and industrial aided the results. Notably, solid automatic test equipment demand remains a positive. Furthermore, growing demand for 100G laser drivers and modules is aiding its performance in the communications and data center market. The company remains optimistic about the flexible manufacturing strategy and diversified product portfolio. Maxim is set to be acquired by Analog Devices for more than $17 billion. Notably, the stock has outperformed the industry it belongs to over a year. However, sluggishness in communications and data center market remains a headwind. Also, the coronavirus pandemic remains a concern.
Shares have gained 5.82% over the past four weeks and there have been 9 higher earnings estimate revisions for fiscal 2021 compared to none lower. The consensus estimate has moved up as well.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Maxim Integrated Products, Inc. (MXIM): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
