1、 BofA Securities does and seeks to do business with issuers covered in its research reports.As a result,investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report.Investors should consider this report as only a single factor in making the

2、ir investment decision.Refer to important disclosures on page 26 to 29.Analyst Certification on page 25.Price Objective Basis/Risk on page 24.12852906 US Semiconductors Analog update:where are we in the recovery cycle?Price Objective Change Auto semis more controversial but with more upside potl We

3、preview industrial/auto,aka analog or diversified,chipmakers ahead of Q2 earnings but also then zoom out to understand where we are in the recovery cycle from a sales and valuation perspective relative to the implied CY19-26E trendline(pre COVID-19 to first full“normal”year.).Key conclusions:1)Indus

4、trial semis(ADI,TXN,MCHP)are within 10%of theoretical upside returns,with ADI screening better than peers on FCF,2)Auto semis(NXPI,ON)screen as most attractive from a return-to-trendline and valuation perspective.Analog semis provide diversification away from AI-heavy portfolios but are tougher to a

5、nalyze due to macro/tariff cross currents.On better recovery visibility,we raise PO for NXPI to$270(from$250)based on 23x CY26E PE(21x prior),our top pick given:1)strong auto recovery leverage;2)unique product-cycle drivers;and 3)attractive valuation at 16x CY26E PE vs.peers at 19x-42x.We also raise

6、 POs for ADI to$275(from$260)based on 31x CY26E PE(29x prior),ON to$70(from$60)based on 25x CY26E PE(22x prior)and reiterate Buy.Keep Neutral given premium valuations but raise POs on TXN to$218(from$210)on 34x CY26E PE(vs.33x prior)and MCHP to$75(from$70)on 8.5x CY26E EV/S(8x prior).Volatile near-t