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Nordic Semiconductor ASA NOD

Morningstar Rating
NOK 132.95 −0.05 (0.04%)
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Company Report

Nordic Earnings: Shares Jump 35% Converging With Our NOK 127 Fair Value Estimate, Which We Maintain

Narrow-moat Nordic Semiconductor's shares jumped by a sharp 35% in trading on April 24, reaching NOK 120 per share and mostly converging with our NOK 127 fair value estimate, which we maintain. The surprise came from Nordic’s second-quarter guidance, which implies an important acceleration to NOK 115 million- NOK 135 million in revenue compared with the weak NOK 74.5 million recorded this quarter. Nordic’s guidance is in line with our assumptions as we expect a sequential acceleration in revenue through the year from the very low base recorded in the first quarter. At this point, we recommend investors look for opportunities with a higher margin of safety, given the low visibility of Nordic’s financials as management does not provide yearly guidance and sales are normally lumpy given consumer exposure and high revenue concentration. We assume a high-single-digit revenue decline in 2024, followed by a strong 37% recovery in growth in 2025, reaching almost EUR 700 million in sales at a 9% operating margin.

Price vs Fair Value

NOD is trading at a 154% premium.
Price
NOK 132.95
Fair Value
NOK 243.00
Uncertainty
High
1-Star Price
NOK 931.88
5-Star Price
NOK 19.80
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Nordic is the leader in Bluetooth Low Energy, a market with double-digit growth rates where Nordic enjoys 40% market share. Nordic’s top-line growth should remain healthy in the next decade.

Bears

Nordic’s position in the semiconductor supply chain is weak. Foundries might prioritize larger players such as automobile companies, which use similar manufacturing technologies as Nordic. Nordic has historically had one foundry supplier. In 2022 it brought in two more to diversify its supply chain.

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News

Trading Information

Previous Close Price
NOK 133.00
Day Range
NOK 132.95135.45
52-Week Range
NOK 76.96150.75
Bid/Ask
NOK 130.00 / NOK 135.90
Market Cap
NOK 25.57 Bil
Volume/Avg
684,548 / 760,172

Key Statistics

Price/Earnings (Normalized)
69.81
Price/Sales
5.12
Dividend Yield (Trailing)
Dividend Yield (Forward)
Total Yield

Company Profile

Nordic Semiconductor has a leading market share in the design of Bluetooth Low Energy chips for the wireless industry, making 90% of its revenue from this technology. Nordic’s chips are used in all types of battery-powered devices such as wearables, smarthome applications, asset trackers, and industrial and healthcare markets. In recent years Nordic has also expanded into adjacent technologies such as Wi-Fi, thread protocol, and long-range connectivity. In 2022 Nordic generated almost $800 million in revenue.
Sector
Technology
Industry
Semiconductors
Stock Style Box
Small Growth
Total Number of Employees
1,493

Competitors

Valuation

Metric
NOD
AVGO
2454
Price/Earnings (Normalized)
69.8132.9120.15
Price/Book Value
4.119.415.03
Price/Sales
5.1215.863.94
Price/Cash Flow
25.6030.5016.97
Price/Earnings
NOD
AVGO
2454

Financial Strength

Metric
NOD
AVGO
2454
Quick Ratio
3.450.830.89
Current Ratio
5.321.331.15
Interest Coverage
6.63226.76
Quick Ratio
NOD
AVGO
2454

Profitability

Metric
NOD
AVGO
2454
Return on Assets (Normalized)
−1.96%20.50%14.63%
Return on Equity (Normalized)
−2.65%59.22%25.37%
Return on Invested Capital (Normalized)
−3.08%26.13%21.76%
Return on Assets
NOD
AVGO
2454
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