Synaptics (SYNA, Financial), a developer of human interface (HMI) hardware and software, strategic shift to higher-margin business, primarily Internet of Things (IoT) products, is bearing fruit as operating margins continue to rise. Although Synaptic announced that chip prices have increased, the company said it has been able to pass the increases on to its customers. We believe the company’s new product releases (i.e., Flexible Organic Light Emitting Diodes, Artificial Intelligence-enabled touch controllers, and low-power System on a Chip products) and accelerating growth in its primary markets (i.e. Artificial Intelligence, Edge Computing and IoT) bode well for the long-term outlook.
From Steven Scruggs (Trades, Portfolio)' FPA Queens Road Small Cap Value Fund second-quarter 2021 commentary.
