“Have the semiconductor stocks finally bottomed?” Jim Cramer asked Thursday on CNBC’s “Mad Money.” And if so, are we looking at a tradable bottom or an investable bottom?
Because there is a difference, he said. A tradable bottom if what happens when people get too negative, while an investable bottom comes before a real turn in a company’s business.
Intelmay have given us a tradable bottom on Wednesday, but Cramer wanted to tap into Xilinx for more intelligence. The San Jose, Calif.-based chip maker reported better-than-expected earnings of 47 cents a share last night but guided down expectations, giving a “pretty dire” forecast for the next quarter. The firm announced gross margins of 66 percent but forecast that sales would decline by 4 to 8 percent sequentially due to slowing order rates.
Now, Cramer said Xilinx looks cheap — trading at just 11 times 2013 expected earnings with a long-term growth rate of 12 percent.