This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Himax (HIMX) Plunges on Earnings: Is it Still a Buy?

NEW YORK (TheStreet) -- Semiconductor company Himax (HIMX - Get Report) plunged 9.1% to $8.61 after reporting soft fourth-quarter guidance before the bell.

The Google (GOOG) Glass components-maker said it expects fourth-quarter revenue flat or slightly lower than $192.8 million in the third quarter. Analysts surveyed by Yahoo! Finance expected revenue of $207.98 million. The company said it anticipates earnings between 7.5 cents and 9.5 cents a share, lower than analysts' expectations of 11 cents a share.

The Taiwanese manufacturer attributed the weak guidance to decreasing demand for large-size LCD components which accounts for 30% of revenue. During the third-quarter, sales of these components dropped 25% on the year-ago period, adding to a 19% drop seen in the second quarter.

Offsetting weakness for large-size LCD drivers, Himax reported 15.1% growth in sales of small- to medium-panel drivers, contributing 52.1% to total revenue. Non-driver sales, which include microdisplays provided to Google, grew 30.5% to $34.6 million compared to third quarter 2012.

Though inching 1.3% higher, third-quarter revenue missed estimates by $720,000, as analysts expected $193.52 million. Earnings of 11 cents a share beat estimates by 1 cent.

TheStreet's fundamental analysis expert Bryan Ashenberg had this to say about Himax:

"Trifecta Stocks holding Himax Technologies beat its third-quarter earnings estimate by a penny as earnings came in at $0.11 and revenue rose 1.3% year-over-year to $192.8 million, in line with consensus. The company issued lowered guidance, in line with our earnings preview. Our bottom line is that we are still focused on the LCoS pickup and view near-term volatility as a buying opportunity.

"Management commented on the LCoS business saying they had new design-wins from multiple top-tier customers for new head-mounted display projects. Management refused to comment directly on a specific customer (Google), but commented that they have plenty of capacity to meet customer demands and are ready for the customer's ramp in 2014. Current capacity can produce 200,000 panels a month, and the company expects to be able to ramp to production of 2 million panels a month in a short period of time, as needed by their end customers. Management has purchased additional land around their manufacturing facility so they can expand capacity as needed.

"This stock investment is about what will be, and not what is, and therefore, we reiterate our bullish stance on the name. You can read more about this stock pick and our other picks by taking a 14-day free trial to the service here: Try Trifecta Stocks."

TheStreet Ratings team rates Himax Technologies Inc as a Buy with a ratings score of B. The team has this to say about their recommendation:

"We rate Himax Technologies Inc (HIMX) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, solid stock price performance and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
HIMX $6.44 0.00%
GOOG $552.03 0.00%
AAPL $126.37 0.00%
FB $83.20 0.00%
TSLA $190.57 0.00%


DOW 17,976.31 +263.65 1.49%
S&P 500 2,086.24 +25.22 1.22%
NASDAQ 4,947.4410 +56.2220 1.15%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs