Analyst Note
| Brian Colello |Infineon reported strong results for the March quarter and provided investors with an upbeat forecast for the June quarter and fiscal 2023 (ending in September), as the company is still prospering from robust demand for power semiconductors used in electric vehicles and “green” industrial products. Pricing remains strong, and we remain impressed with Infineon’s ongoing gross margin expansion, which we think the firm can maintain (cycles permitting) in the long term. We are raising our fair value estimate for narrow-moat Infineon to EUR 47 from EUR 43 (and to $52 from $48 for U.S. shares), and continue to view the firm as undervalued.