Dec 24 (Reuters) - Supertex Inc SUPX.O could be an attractive target for chipmaker Microchip Technology Inc (MCHP.O) due to its high cash position and strong long-term growth drivers, said Lazard Capital Markets, which upgraded the stock to "buy" from "hold."
Shares of semiconductor maker Supertex jumped 13 percent to $23.13 Wednesday morning on Nasdaq.
Microchip and ON Semiconductor Corp ONNN.O had previously made a joint hostile bid for Atmel Corp ATML.O but abandoned their efforts amid weakness in the semiconductor market and the overall global economic crisis. Atmel had rejected their $2.3 billion bid as too low.
"We think that the difficulty in the bid for Atmel frees Microchip to look at potential other acquisitions," analyst Daniel Amir wrote in a note to clients.
Microchip on Tuesday reported a 5.4 percent stake in Supertex.
Supertex stock is about 20 percent undervalued on a fundamental basis, said Amir, who has a price target of $25 on the stock. (Reporting by Shrutika Verma in Bangalore; Editing by Deepak Kannan)