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Himax Tech (HIMX - Free Report) is a Zacks Rank #2 (Buy) preannounced the quarter on Janurary 7 and the stock has been on a big run since then. The company noted that there would be some “noise” in the bottomline number, but the topline was going to come in ahead of expectations and gross margins were going to exceed guidance as well. All of this has drive the stock to nearly double digits and now it is the Bull of the Day.
Earnings History
I am not sure I can remember the last time I saw a smaller name like this meeting the number in each of the last four quarters. No beats isn’t great, but I really like the idea of no misses. All in all, I would rather see a few beats but there is no negative news to report on this front.
Of course part of the reason for this is the company guiding before the print, so that gives the analysts a chance to really narrow in on the number.
Estimate Revisions
I see some good revisions here, with this quarter moving higher in the last month or so. The Zacks Consensus Estimate moved from $0.16 to $0.20 over the 30 days.
Next quarter saw a move from $0.06 to $0.13, but that was a move from 90 days ago and thus will not impact the Zacks Rank.
The Zacks Rank cares the most about the annual numbers and while 2020 is over, it has yet to be reported. I see the number moving up from $0.24 to $0.30. That is good to see.
The 2021 number has inched higher to $0.45 from $0.44 over the last 30 days, but up from $0.35 over the last 90 days which suggests there is some good estimate momentum here.
Valuation
I like the valuation here with a forward PE of 19x when the company showed topline growth of 46% on an annual basis last quarter. Next year, estimates are calling for 20% topline growth and that could be on the low end of things. The price to book is only 3.3x, which is just about the range that will keep the value players interested. The 1.9x price to sales is also very low here, so I like that too.
Margins are thin here, so a small improvement in execution could result in much higher EPS. That is something that we could see when HIMX reports again in early February.
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Bull Of The Day: Himax Technologies (HIMX)
Himax Tech (HIMX - Free Report) is a Zacks Rank #2 (Buy) preannounced the quarter on Janurary 7 and the stock has been on a big run since then. The company noted that there would be some “noise” in the bottomline number, but the topline was going to come in ahead of expectations and gross margins were going to exceed guidance as well. All of this has drive the stock to nearly double digits and now it is the Bull of the Day.
Earnings History
I am not sure I can remember the last time I saw a smaller name like this meeting the number in each of the last four quarters. No beats isn’t great, but I really like the idea of no misses. All in all, I would rather see a few beats but there is no negative news to report on this front.
Of course part of the reason for this is the company guiding before the print, so that gives the analysts a chance to really narrow in on the number.
Estimate Revisions
I see some good revisions here, with this quarter moving higher in the last month or so. The Zacks Consensus Estimate moved from $0.16 to $0.20 over the 30 days.
Next quarter saw a move from $0.06 to $0.13, but that was a move from 90 days ago and thus will not impact the Zacks Rank.
The Zacks Rank cares the most about the annual numbers and while 2020 is over, it has yet to be reported. I see the number moving up from $0.24 to $0.30. That is good to see.
The 2021 number has inched higher to $0.45 from $0.44 over the last 30 days, but up from $0.35 over the last 90 days which suggests there is some good estimate momentum here.
Valuation
I like the valuation here with a forward PE of 19x when the company showed topline growth of 46% on an annual basis last quarter. Next year, estimates are calling for 20% topline growth and that could be on the low end of things. The price to book is only 3.3x, which is just about the range that will keep the value players interested. The 1.9x price to sales is also very low here, so I like that too.
Margins are thin here, so a small improvement in execution could result in much higher EPS. That is something that we could see when HIMX reports again in early February.
Chart
Himax Technologies, Inc. Price and Consensus
Himax Technologies, Inc. price-consensus-chart | Himax Technologies, Inc. Quote
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
Click here to download this report FREE >>