Why Himax (HIMX) Is Down Today

NEW YORK (TheStreet) -- Himax (HIMX) shares fell 6.7% to $13.56 Tuesday following a downgrade from Chardan Capital Markets.

In a note sent to investors, Chardan analyst Jay Srivatsa downgraded Himax to "neutral" from "buy," setting a price target of $12. In the note Srivasta said many investors appear to be holding onto the stock in anticipation of head-mounted displays such as Google (GOOG) Glass which may use the company's LCoS Microdisplays. The analyst warned that isn't a good idea, however.

Srivasta wrote "it is our view that investors should own HIMX for its core business rather than the potential it offers from an untested product such as the Google Glass etc." In the company's core business of display drivers the analyst expects strong competition from companies such as Novatek, Orise, and Illitek. That competition may force Himax to lower prices to compete.

TheStreet Ratings team rates HIMAX TECHNOLOGIES INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about its recommendation:

"We rate HIMAX TECHNOLOGIES INC (HIMX) a BUY. This is driven by several positive factors, 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 solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows low profit margins."

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