Smartphone growth in emerging markets remains strong, and the trend continues informing investment decisions in the communications semiconductor sector, says Aalok Shah, Senior Vice President and Senior Research Analyst at D.A. Davidson & Co.
“In [emerging markets], you still have 3G adoptions increasing, particularly in India, China and Latin America. Those are the real growth areas right now,” Shah said. “China has now completed, for the most part, the infrastructure buildout for 3G, and so now we’re just waiting for the subscribers to come.”
Shah likes Broadcom (BRCM), a semiconductor company providing connectivity solutions within phones. The company’s combo chipset solutions provides phones with capabilities such as WiFi, Bluetooth, GPs and FM radio.
“[Broadcom] can do it all in what they call their combo chipset solutions, and they have almost 90% market share in that space,” Shah said. “I think that in anything mobile related you’re going to need these types of chipsets. Whether that mobile device is a tablet or a smartphone or even a regular phone, you’re going to see more and more connectivity devices.”