Is Atmel Corporation (ATML) Destined for Greatness?

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Atmel Corporation (NASDAQ:ATML) posted a year-over-year gain of 6% net revenues in its latest quarter, which is one indication that the company is moving in the right direction. Longtime Fool contributor Selena Maranjian also notes that Atmel has been boosting its profit margins on the back of cost-savings and improving business conditions. In addition, Atmel has very large order backlogs, which can effectively contribute further revenue in the $339 million to $355 million range. Sustained demand for mobile devices and tablets should certainly help sustain interest in its chips over the next few quarters.

Atmel manufactures the sensor hub for Samsung’s Galaxy S4, and can also capitalize on the growing Chinese smartphone market through placements inside ZTE’s and Xiaomi’s phones. Atmel also provides the maXTouch controller for BlackBerry‘s Q10. However, the company has lost its bid to supply chips for a number of core Apple products to rivals Cypress Semiconductor and Texas Instruments, which could, more than anything, undermine the company’s efforts at recovery.

Early this year, Integrated Device Technology sold its smart metering business to Atmel. Fool contributor Rich Duprey notes that the acquisition will augment its existing offering of smart metering chips. According to Pike Research, annual smart grid revenue will reach $73 billion by 2020, which gives plenty of space for Atmel to grow.

Putting the pieces together

Today, Atmel has some of the qualities that make up a great stock, but no stock is truly perfect. Digging deeper can help you uncover the answers you need to make a great buy — or to stay away from a stock that’s going nowhere.

The article Is Atmel Destined for Greatness? originally appeared on Fool.com and is written by Alex Planes.

Fool contributor Alex Planes has no position in any stocks mentioned. The Motley Fool recommends Apple and Cypress Semiconductor . The Motley Fool owns shares of Apple.

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