ANAD Supplies for New Samsung Phone (ANAD) (SWKS) (TQNT)

ANADIGICS, Inc. (ANAD) recently announced that it will provide ALT6181 multimode multiband power amplifier (MMPA) to Samsung Electronics for its new Galaxy Express smartphone. This new series of smartphones will be available through AT&T shortly.

ANADIGICS primarily provides semiconductor solutions in the growing broadband wireless and wireline communications markets.

The company’s product line includes radio frequency (RF) power amplifiers (PAs), tuner integrated circuits, active splitters, line amplifiers and other components. The RF power amplifier products enable mobile handsets, datacards and other devices to access third and fourth generation (3G and 4G) wireless networks by utilizing international standards like LTE (Long Term Evolution), WCDMA (Wideband Code Division Multiple Access), HSPA (High Speed Packet Access), CDMA (Code Division Multiple Access), EVDO (Evolution Data Optimized) and WiMAX (Worldwide Interoperability for Microwave Access).

The MMPAs from ANANDIGICS combine high speed performance and excellent integration by using the company’s exclusive InGaP-Plus technology and patented design architectures. The solution also offers competitive advantage to mobile device manufacturers by providing extended battery-life, as well as quad-band GSM/EDGE and dual-band WCDMA/LTE functionality in a single package to minimize printed circuit board (PCB) space requirements.

Management remains upbeat about its selection by Samsung for the Galaxy Express. Samsung has been a key customer for the company for quite some time and generated approximately 19% of total sales in 2011.

As demand for high speed data continue to increase by leaps and bounds, multimode multiband smartphones that provide GSM/EDGE, WCDMA, and LTE functionality are touted to be growth engines of the wireless market.

ANADIGICS expects to capture a major chunk of this growing market share by leveraging its advanced technology and design expertise to provide highly integrated solutions to OEMs and ODMs that help save space, extend battery-life, and reduce time-to-market.

However, ANADIGICS remains challenged due to an uncertain economic environment and weakening demand in the near term along with its peers Skyworks Solutions (SWKS) and TriQuint Semiconductor (TQNT).

Hence, we maintain a Neutral recommendation on ANADIGCS in the long run. Our Neutral recommendation is supported by a Zacks #3 Rank, which translates into a short-term rating of Buy.