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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (73168)	7/26/2023 9:25:23 AM
From: Elroy	Read Replies (2) of 78953

You've owned the stock a long time, and must know the business aspects pretty well. Buyout or not, you would be green in it. My cost basis is about $5. It's actually a good business, high volumes in necessary products, but considered low end tech so as a standalone it will never get a high valuation. It usually traded around 8x to10x, despite some years (especially from 2011-15) putting up 25% annual revenue growth. Inside of MXL I can see SIMO's earnings stream getting a "diversified mid-range semi stock PE", which is probably more like 13x-17x. And MXL probably doesn't get the "Taiwan discount". And since MXL is fairly small, it can again become a takeover target for some big semi stock wanting to grow by acquisition. By Q4 2024 I'll bet the acquisition looks brilliant. But it will need to get past the current semi inventory correction, which seems like it has started to end and should be over by Q1 2024 latest.

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