Earlier this week, RF Micro Devices, Inc. announced its decision to come together with Silicon Laboratories, Inc. (SLAB - Snapshot Report) to deliver Sub-GHz solutions to cater to a wide range of smart grid applications. This was done with the clear intent of developing smart energy-efficient solutions for long-range RF devices.
As per this agreement, RF Micro’s RF6569 front-end module (FEM) would be combined with Silicon Labs’ EZRadioPRO(R) Si4464/63 transceivers to produce the cost-efficient and high-powered RF6569/Si4464/63 reference design. This advanced Sub-GHz solution would allow for better monitoring and energy-efficiency of battery-run devices which include metering solutions, security and home automation systems, and the like.
This integration will not only allow for market share proliferation but also enhance satisfaction levels of RF Micro’s customers by providing them with improved and user-friendly smart energy solutions. Silicon Labs would also benefit heavily from this technological advancement and also solidify a long-lasting relationship with RF Micro through this venture.
RF Micro declared its fourth quarter 2012 financial results on April 24, 2012. Revenues for the quarter plummeted nearly 17% sequentially to $187.9 million, primarily due to softness in the Chinese and European markets. Hence, the company needs to take proactive measures to counter these lingering downsides and boost performance.
The company faces intense competition from well-capitalized peers such as TeleNav, Inc. (TNAV), CenturyLink, Inc. (CTL - Analyst Report) and RELM Wireless Corp. .
The current Zacks Consensus Estimate for fiscal 2013 is 17 cents per share. The company currently retains a Zacks #5 Rank, which translates into a short-term ‘Strong Sell’ rating. However, we presently maintain our ‘Underperform’ recommendation on the stock.