With earnings coming up in a few weeks what is every one's projection of the effect it will have on share price? With a miss, hit, or exceed? I'm hoping for great numbers but with the market down lately I'm concerned with what may happen if we have bad numbers.
Sentiment: Strong Buy
You might want to have a few dollars ready to buy should the stock drop. I don't expect that earnings will anything spectacular and seeing that can't comment on the Apple deal you could see the stock drop. If it does, it might be a good time to buy. I also mentioned in a previous post that the Apple deal with GTAT might not be very profitable for a while. Apple paid for the equipment which gives them the right to ask for a low price for the glass. If I'm right you could see this stock in the 12 dollar range for a few quarters.
$12 range for a few quarters...This company seems on the cusp of something huge if in fact they are ramping up 2000+ furnaces. That size of operation isn't being put together to supply buttons and camera covers. All evidence shows that they will be outfitting millions of devices with sapphire. Plus, think about it. You don't get into an arrangement this massive without some guarantee of success. TG is much smarter than that.
(Although some posters here seem to think Apple isn't obligated to buy sapphire and TG is selling out to Apple) TG will take 20-25% margins on sapphire as he knows this is only the beginning of worldwide control of this market and a legacy opportunity to catapult GTAT. Like he said on CNBC, "we are the only ones in the world that can pull this off". That being said, a drop to $12 would be baffling in its own right, but would offer a rare opportunity to have a 4-5 bagger handed to you.
Sentiment: Strong Buy
GTAT guidance for FY14 is 600-800M revs, 85% of which will be in 2nd half. So, 700M x .15 = 105M. With no insight, presume 52.5M Q1 and Q2. EPS consensus for Q1 per nasdaq dotcom is -0.27, -0.19 for FY14, +0.39 for FY15, and +1.22 for FY16. The FY estimates could end up wildly too low, of course. The bar for Q1 FY14 is so low it's laying on the ground.
As I understand the Mesa deal, Apple loaned GTAT 500+M for materials to produce the sapphire furnaces, move them to Mesa, and hire people to make and operate them. (Apple also required GTAT to borrow an additional 200-300M, to provide more motivation to succeed.) GTAT owns the furnaces and GTAT personnel operate them. Apple has not committed to purchasing sapphire in quantity. Both companies took risks here. Clearly, Apple wants sapphire, for iWatch certainly, and iPhone 6, if not at release, eventually, IMHO. The Apple loan is to be paid back starting 2015 over 10 years. I'm not a bean counter, but I don't think a loan can be considered as revenue.
I read that 800+ furnaces were already in Mesa with another 900 coming. The Mesa plant can site 4200-5200 furnaces, based on sq. footage. We have no idea how smoothly the production is going. If things are going great, perhaps they will have enough sapphire to supply the iPhone 6 from the launch. Or, perhaps they are only targeting the 5.5" iPhone 6 for sapphire. I sure would like to know what size screens they are making. 4.7" and 5.5" for the iPhone 6. 1.3" and 1.5" for the iWatch.
Apple DID advertise for, and hire, a solar expert for Mesa. So, it's possible a solar charger will be in the iPhone 6 or iWatch.
Please correct or add to this thesis as you see fit. Wouldn't it be a shame if GTAT, which is open Fri (Good Friday), releases some good news while the markets are closed? The bears will be lined up to pass through the gauntlet on Mon morning, like Kevin Bacon in "Animal House". WHACK! "THANK YOU SIR MAY I HAVE ANOTHER?" WHACK! ...
Good recap and math on prior revenue/earnings projections. I agree with those who say 2Q 2014 is a "non-event" although guidance will be key to show whether they are on track or not. I think the projections were aggressive so on track would be fine with me.
As per your comment on GT hiring a solar expert, this could be for solar charging panels on etched sapphire as mungee etc, project but..............the GT/Apple (ex-First Solar) Plant has solar panels and is supposed to be expanding those so the solar expert position could be just to keep those operating at optimum efficiency and adding to these.
I am not saying you are wrong. I am just adding another thought so as we consider all the potential reasons.
Roll your dice. Then you'll have your answer. Sorry, but nobody but nobody can forecast this...aside from GTAT management.
That's why I anticipate hitting guidance. That's all I want. If that is achieved, then it's more confirmation that we have a long term winner here.
Yes, this is usually a bad sign. Especially since this is probably the last quarter before Apple revenue kicks in and maybe last chance for shorts to drive down price significantly. The only other thing I noticed is that they almost always announce earnings 2 weeks before and this announcement is 3 weeks. Anyway, probably won't matter long term but tea leaves are not positive for this earnings coming up.
The Q1 earnings should have a miniscule impact on the stock price. Not much is expected for this past Q so it's all about how things are progressing Q2 on with the major focus on the 2nd half of 2014 and any color on 2015 and beyond.
Last Q TG raised his 2016 NON GAAP earnings guidance from a minimum of $1 to a minimum of $1.50.
Will he provide further upgraded guidance for 2014 and/or 2015 and/or 2016?
Anymore color on where the various technologies showcased on the Investor Conference stand? Being that was only on 3/14 I'm not sure how much more we will hear less than 2 months later but one never knows.
The real thing many investors would welcome besides any improvements in go forward guidance are any more meaningful contracts between now, earning's day and shortly thereafter.
Hopefully the passing of time is on our side.