Dialog Semiconductor’s shares rally after revenue forecasts beats market consensus
Chip designer, which struck a $600m transfer deal with Apple, projected a 4% single-digit revenue dip versus market’s 9%
Frankfurt — Dialog Semiconductor reported a slight rise in fourth-quarter operating profit and said revenue would decline in 2019 as it completes a $600m transfer of programmers and patents to iPhone maker Apple. Shares in the Anglo-German chip designer rose by nearly 4% at the open after its forecast of a single-digit percentage revenue drop this year came in above a consensus view among analysts of a 9% fall. The Anglo-German chip designer struck a deal in October 2018 to reduce its exposure to Apple, which accounts for three-quarters of revenue. The transaction is expected to close in the first half of the year, handing Dialog a cash windfall to back its transition to a smaller, more diversified business. “We find this transformation of Dialog’s business compelling, and think its current valuation overly discounts the risk associated with the company’s evolving business model,” Barclays analyst Andrew Gardiner said in a note. Gardiner holds an “overweight/neutral” rating on the s...
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