Cirrus Logic, Inc (NASDAQ:CRUS)’s profit logic might hinge on iPhone’s China success

Posted by Lynn Eisler September 5, 2013 0 Comment 5604 views

Cirrus Logic, Inc (NASDAQ:CRUS) is one of the biggest digital and analog signal processing components supplier. Its products are used widely in the energy and audio markets. Despite this, the one fact that keeps this exceptional company in the fore is the fact that most tech watchers simply consider CRUS to be an Apple supplier. It is true that AAPL is Cirrus’s top customer, but the company has well over 25,000 customers including electronics giants such as Samsung, Sony and LG and auto company Ford.

Flowing with the Apple tide

And so, whenever there is either an ebb or tide at Apple, the Cirrus currents will also undeniably undergo a change. In the most current news, Apple has announced its United States 10 September launch as well as the subsequent satellite events across Tokyo, Beijing and Berlin. CRUS had a particularly dismal run for a larger part of 2013 but the Apple news stoked the dying embers and the company climbed 16% from its 27 August close.

Cirrus Logic, Inc (NASDAQ:CRUS) rose 6.39% in Wednesday’s trading session. The opening price of $22.80 touched an intraday high of $23.85 and closed at $23.81. More than 3.74 million shares were traded on Wednesday while the average volume of shares traded over 30 days was 2.48 million. The company has a market cap of 1.51 billion.

The China factor

Apart from the fact that Apple will be launching its latest product, the Beijing event is of particular interest in that it has added fuel to the speculated China Mobile deal. Currently only around 1/3rd of Chinese mobile subscribers use smartphones. This means that if Apple does everything right, it has the potential to transition around 73 million of China’s mobile phone subscribers to being iPhone users. And need we say that Cirrus Logic can ride on that tidal wave and reap profits while the iPhone shines in the east?

About Lynn Eisler

Lynn Eisler is a national news reporter focusing on economic issues, data analysis and the financial health of state and local governments. Lynn has been honored with the H.L. Mencken Award for Investigative Reporting, the Champion of Justice Award for reporting on the drug war, and the John Hancock Award for business reporting. Lynn was also a Knight Medical School Fellow at the University of Michigan.

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