NXPI – Market expectations are for Uniform ROA to recover, but management may have concerns about growth, EBITDA, and inventory

• NXP Semiconductors (NXPI) currently trades below corporate but near historical averages relative to Uniform earnings, with a 14.3x Uniform P/E (Fwd. V/E’).
  
• At these levels, markets are pricing in expectations for Uniform ROA to recover to 24%, accompanied by 3% Uniform asset growth.
  
• Meanwhile, analysts expect Uniform ROA to expand to new highs of 35% by 2022, accompanied by 8% Uniform asset growth.
  
• These levels would imply a stock price closer to $396, representing significant potential equity upside for the firm. That said, peak profitability is unlikely to be sustained going forward, given the highly cyclical nature of semiconductors.
  
• However, the firm’s most recent earnings call suggests management may have concerns about growth, EBITDA, and inventory.