Himax Technologies (HIMX) Stock Up, Nomura Upgrades
NEW YORK (TheStreet) -- Shares of Himax Technologies (HIMX) - Get Report are up 2.32% to $8.21 in late-morning trading as the company's rating was raised earlier today to "buy" from "neutral" at Nomura.
The Taiwan-based display technology maker had a decent 1Q16 as it helped supply components for Microsoft's forthcoming (MSFT) headset HoloLens, rebuilt its inventory with display drivers, and shipped OLED DDI (organic light emitting device display driver) to Samsung, according to an analyst note.
Despite the positive start to 2016, shares have dropped 38% from their peak, which Nomura predicts is from the downward revision of HoloLens shipments.
To account for the uncertainties in the second quarter, the firm lowered Himax's price target to $9.70 from $10.30 and its 2016F/17F earnings estimates by 19% and 23%.
Even with these price decreases, Nomura says Himax received a "buy" rating because "the risk-reward is now more positive considering the future AR/VR trend."
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate HIMAX TECHNOLOGIES INC as a Hold with a ratings score of C+. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and poor profit margins.
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