Is Amkor the Next Apple Winner?

Amkor Technology, Inc. (NASDAQ: AMKR) has seen ups and down of late in its revenue cycle, even if 2013 is expected to be a return to growth. The company provides outsourced semiconductor packaging and test services by offering package formats and services. If Credit Suisse is correct, Amkor could be the next chip stock riding the coat tails of Apple Inc. (NASDAQ: AAPL).

In a new research report on Tuesday, Amkor was reiterated as Outperform and its price target is $6.00 per share. If that comes to fruition, Amkor still has close to 50% upside. Only three firms follow this chip company, but the consensus target price is also $6.00 from Thomson Reuters.

Credit Suisse said that Amkor's high-end packaging growth overshadows its 2.5D risk by saying, "Amkor noted 48% of sales from Wafer Level CSP and Flip Chip, areas growing at double-digit rates on tablets/smartphone demand. At the same time, the company sees 3D starting a niche and high-end, and not reaching the mainstream smartphones/tablets until 2016." As far as how the Apple play comes in: "From Amkor, the shift to high-end packaging including a potential Apple opportunity far overshadows the risk from foundry on 2.5D/3D packaging."

Amkor trades at $4.11 and has traded in a 52-week range of $3.65 to $6.78. Its market cap is only about $630 million. For 2013, Thomson Reuters consensus estimates (again from only three analysts) are $0.72 EPS and $2.87 billion in revenue.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Analyst Calls, Semiconductor, Technology Tagged: AAPL, AMKR