Investors reacted to unconfirmed reports that Google (GOOG) (GOOGL) will no longer use Himax's display chips in its Google Glass wearable computer. Shares of the semiconductor design company fell more than 14% intraday as investors debated whether to sell on the questionable news. The stock was the most discussed on StockTwits.com by 3:30 p.m.
Emails to Google's press team and media contacts at Himax asking for comment were not immediately returned Tuesday.Traders had anticipated that Google and Himax's relationship was for the long term. Google took a 6.3% stake in the display subsidiary of Himax Technologies last July. At the time, Himax said Google's stake would fund the necessary upgrades and investments needed to expand production of the "liquid crystal on silicon" chips used in Google Glass and other wearable displays and pico-projection devices. Under the agreement, Google has the option to increase its stake in Himax's display subsidiary to 14.8% by July 22, 2014. Some investors said that Google and Himax were still partners. They argued that Google would eventually exercise the option to own more of the company, leaving investors who sold shares today in a panic wishing they had a higher risk threshold.
@mine1996 $GOOGL Has a lot of cash there just waiting for right moment. ? Lionel G (@lionelg) May. 27 at 03:12 PM
@lionelg - u bet... I trying to accumulate without selling other positions to load up more.. ? Sonny (@mine1996) May. 27 at 03:13 PMSentiment on Himax is 92% bullish. Some investors argued that -- on the off chance that the rumors were true -- Himax's display technologies are interesting enough to still warrant buying into the company. Wearable computers are the future, they argued, and Himax's display chips will be demanded by far more than Google. The $1.13 billion company has a price to forward 2015 earnings ratio of about 11 times. That's less than many other new tech companies.
$HIMX -hold your shares,,, and add at this price... this is a solid company without glass... do your own DD... solid buy here.. ? Sonny (@mine1996) May. 27 at 03:05 PMAt the time of publication the author held no positions in any of the stocks mentioned. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts