J.P. Morgan’s Christopher Danely, 42, repeats at No. 1. “Chris is unafraid to take a controversial stance,” reports one backer. San Francisco–based Danely says that the best-performing stocks in the sector are likely to be Analog Devices, Texas Instruments and Xilinx. These businesses “should achieve all-time highs in both margins and earnings,” he predicts. “And they are all good operators and well-run companies.” Xilinx, a San Jose, California–based manufacturer of programmable logic devices, has been a top pick since January 2012. Danely believed it had the most exposure to the communications segment, would for the first time eclipse crosstown rival Altera Corp. in market share and would hit new highs in margins, thanks to a new foundry partner and management’s focus on operations. He was right: Xilinx had by June 2013 both outgrown Altera and posted a record margin gain. Through August the stock climbed 37.6 percent, from $31.55 to $43.42, besting the PHLX Semiconductor Sector by 15.3 percentage points. Looking ahead, Danely expects the automotive, communications and industrials segments to deliver strong returns, while the PC and wireless subsectors will be weak. — Pam Baker |
The 2013 All-America Research Team: Semiconductors, No. 1: Christopher Danely
