demerson is still waiting for GTAT to correct back down as he wrote last week that he sold half his shares as the price around $16 was a gift and he was going to buy back in lower.
More likely, demerson is looking for that post so he can delete it :-)
The Apple money is most likely mostly spent.............nearly as fast as it is coming in. They are getting the Apple money in tranches or progress payments for a reason.....................and thus having received 3 payments means GTAT has met their obligations on progress. This should be bullish.
But, Apple is not giving GTAT the money to put in the bank. They are making these progress payments to help GTAT pay to get the Mesa AZ plant up and running. So, I would expect most of the Apple money as having been spent on the upgrades, furnaces, etc., etc.
If you read the 1Q 2014 statement carefully, you will see that GTAT cash dropped by ~$93 million (only two Apple payments as the third has been since the 1Q 2014 quarter ended). This is all bullish as it means that GTAT is meeting their obligations and that significant progress is being made where it needs to be made.
It is on orders and such that we can complain as the backlog is not growing as large as some might expect..........and the lower revenue numbers says they haven't been fulfilling many orders. But, I look for this to change over the next quarter or two as the larger furnaces are now available for ordering and Hyperion is getting near.
Great news demerson09 as I was hoping I would not have to read your rambling and non-informative posts on the Private Message Board.
We all know you are not a sheep..........more of a horse's rear end.
I have mixed blessings about a private message board but there is a time and place for privacy.........and it is not always about exclusion..........but around wanting to speak frankly and not for public consumption. Ask Donal Sterling, John Kerry and even Mitt Romney about wanting to keep private conversations private.
I would also stack my passport up against yours (worked international for 8 years and 'rotated' monthly with numerous stop-offs. You are living proof that travel doesn't necessarily improve someone's knowledge or imagination........but it can in the case of someone who doesn't think they know it all and are thus open to learning.
As Daniel Boorstein wrote "The biggest obstacle to discovery is not ignorance.......but the illusion of knowledge." You are here always telling us how much you know rather than reading and trying to learn. One can learn things from many people if you are open to the principle that you don't know it all.
Go re-read some of your comments which have not been deleted.........the ones which proclaim much knowledge, experience, imagination, etc., etc. Why not spend that time researching elsewhere and reading/learning.
When was the last time you visited the GTAT website..........researched GTAT competitors (and there are lots as GTAT is in many sectors now), etc., etc.
Post less and read move!!!!!!!!!
Okay, I understand Chardan's comments (delay in Google Glass, Inventory correction at Samsung, etc.)) although I don't get how they come up with a $6 price target on HIMX.
Anyway, I have been buying HIMS here as the fear and blood in the street is perfect for buying. If one has a 12 to 18 month time frame, I think HIMX returns at least 100% from here and probably much more.
None of us can guess the timing on Google Glasses.........but there is so much more to HIMX than Google Glasses. Read the Seeking Alpha Conference Call Transcript. HIMX will have a strong finish to 2014 and they will be selling lots of LCOS displays and camera arrays by year end.
Note that selling Jan 2016 Puts are a great deal. You can get $2 for selling the Jan 2016 $7 Puts and $8.20 for selling the Jan 2016 $15 Puts.
I'll write more later about my thoughts on the 1Q 2014 CC but this is a great place to be buying today (and for selling Puts). I suspect many shorts will be covering in the next week or so as there just isn't much more downside for a stock which just reported $0.09/share EPS and guided for $0.13 - $0.15 in 2Q (even with one-time gain). The newly lowered EPS is $0.54 in 2014 and $0.69 in 20015. That is still around 30% growth rate and a 20 P/E gives us a $13.80 share price in 12 to 18 months...........and we will get a dividend each July.
It is hard to predict how long this sale will last on HIMX.......as they will not report much news other than a dividend until they report 2Q 2014 in August. But, we do have MSFT having their Xbox plans/conference coming up in early June and I would think their Gaming Goggles have to be a part of that future.
Okay, it is clear to me that GTAT will not move meaningfully higher until some of the promise becomes reality. I am not overly concerned as I bought in last June at $4......but thought I would put this out for y'all to comment.
Current expectations are for 2014 Revenue of $600 to $800 million with $700 million being the anticipated average (Yahoo Analyst Estimate is $698 million).
1Q 2014 was $22.5 million with:
"Equipment orders booked during the quarter were $29 million, including $15 million in PV and $14 million in Sapphire. The company ended the quarter with $609 million of equipment backlog, consisting of $300 million of ASF(TM) orders, $296 million of polysilicon orders and $13 million related to PV equipment. Subsequent to the close of the quarter, the company booked a $58 million order for high temperature specialty furnaces, which will be reflected in the Q2 reported backlog."
Now, with the sapphire revenue not being recognized until delivered to Apple assembler and the iPhone 6 not expected until September, this leads me to believe we might have around $50 to $75 million in 2Q revenue and then the remaining $600 million split between 3Q and 4Q. I split them as a September iPhone release means very aggressive assembly in July and August to be ready for September.
The only downside I see is if the sapphire being delivered to Apple is only for the larger iPhone and that is delayed due to issues.
Finally, I don't think the 2Q revenue matters.........but the outlook needs to stay at $600 to $800 million for 2014 or be raised. Their 3Q estimate should tell us something about when the iPhones will be released as it would reflect sales to Apple Manufacturing company.
The other drivers for GTAT (revenue or good news for the stock price) will be updates on Hyperion, SiC and especially adoption/testing results of Merlin. Any news of the non-Mesa plant expansions could also help the bullish case.
If I only value HIMX on what came out on the Conference Call, I would not be looking for a larger movement up in price until August or so when HIMX again gives an outlook.
I am a bit disappointed in the 2Q outlook with the earnings only being what they are due to the gain on their venture investment. Otherwise, we are looking at essentially what we saw in 1Q 2014 with flat sales, margins and earnings.
I do give Management credit for 'plugging the sales/revenue gap' due to the inventory correction reduction in sales by their Korean customer (Samsung???) but the bottom line is the bottom line.
The bit I read about LCOS manufacture volume was not bullish as the did not forecast or give hints of any ramp up.
So, I can see where Chardan took this data and then twisted it to give their $6 price target on HIMX (~15 times trailing earnings).
Where I differ from Chardan is that I give credit for the upcoming dividend, think there is more to come from other LCOS Customers (including displays and camera arrays outside of Google) and then credit for great Intellectual Property (LCOS displays, LCOS camera arrays, touch controllers, etc.) and great customer list (see updated presentation).
My personal take is that HIMX COULD be range bound these next few months but this is a great place to build a position for later 2014 and then 2015 and certainly 2016 when LCOS Displays and Camera Arrays are more mainstream for nearly the entire year.
Short term price COULD be greatly impacted by the upcoming dividend play and then how many people think like me and try to build a position in HIMX for the future. But, I just don't see a lot of reasons to get excited right now. HIMX puts out very little news so, other than upcoming July dividend, we will not hear much good news until their August Conference Call.
Good luck to all longs. I am buying some shares of HIMX but am focusing more on selling Jan 2015 and Jan 2016 Puts at various price points (bullish plays).
Thanks for the call summary.........and I am waiting for the Seeking Alpha transcript for my second review.
I think TG was somewhat conservative as you show items with potential but discounted for 2014. But, I also think there was no reason to raise the ante on 2014 revenue as the build is so steep right now. And, without firm order backlog growth, there is no real basis to raise it now. We will see at the 2Q CC and then 3Q.
For the long term shareholders, the story stays intact and 2015/16 are going to be as good or better than expected on revenue and earnings. The share price will take care of itself.
Good post indianapolebron,
I would also challenge HIMX to use the remainder of their $12+ million buyback program to buy back shares at anything under $7.25. That would send a strong signal...........and allow ~1.75 million shares to be purchased and retired.
You should have also seen the solar arrays on the southeast of the lot (and they are on the roof although these are not easily seen).
The southwest also has the evaporation (water) tanks and the west has the switch gear which can be seen from Elliott Road on the north.
I am currently in Phoenix and have been by there 4 times now between February and the present.
Thanks again for your update.
Hey rudedudde_2k, retailbaloon, etc.,
Keep in mind that projections for 2H 2014 is over 3% growth in GDP and many company margins are very good meaning additional revenue will help bottom line quite a bit.
Also, there is lots of skepticism in the market so that minimizes the 'irrational exuberance' problem as there is still a lot of money on the sidelines and shorts volume is healthy (vs. low).
I like a market that 'climbs a wall of worry' rather than very bullish as that means there are shorts to cover and more money on the sidelines coming in rather than most of the money 'all in'.
Having written this, I do think Obamacare & the corporate mandate kicking in at 2014 year end could suck lots of cash out of the non-healthcare markets as people get hit with higher premiums and especially deductibles so be careful in 2015. GDP will look fine as healthcare is part of GDP.............but the non-healthcare market and companies could suffer in 2015.
If you are worried about iPhone6, then look at:
- the other sapphire markets where GTAT excels
- The sale of GTAT sapphire furnaces to others (saving the largest size for themselves???)
- The PV markets
- The SiC markets
- The various other crystalline markets where GTAT plays and excels
- The value of Hyperion and game changer it is
- The Merlin technology for reducing solar install costs (reduces silver) and improves efficiency
So, you are very short-sighted to only worry about iPhone6 as there are many other things to GTAT (and for you to worry about as per perhaps short of not owning GTAT).
And, what is iPhone6 does better than expected????????
The only way we see $10 to $12 is when the story changes significantly and dives under expectations. I don't see this happening as there are too many institutions/funds in GTAT. Keep in mind that GTAT is getting closer each day to that $600 to $800 million in revenue (and then over $1 billion). So, time does not favor a drop in price to $10 to $12.
In my opinion, the best plays on GTAT are to sell Puts for Jan 2015 and Jan 2016. If you want money for nothing, you sell the lower priced puts. If you want to get the shares, sell the higher priced Puts.
Note that there are Put strike prices out there where you would get the shares at a lower price than buying it at the market. But, you do risk not getting any shares if you use a Put strike price under $20 for Jan 2015 and $25 for Jan 2016. But, collecting the Put premium can be attractive as you put very little capital at risk.
I have some sold some of both. The lower priced strike prices are very low risk and getting money from selling $15 Puts is attractive as they are bidding $3 for Jan 2015 Puts which is a net price of $12 if the shares are put to you. Most likely GTAT will be above $15 which means you get no shares.............but you keep the $3.
If anyone is watching, there were some interesting last and after hour trades today:
- last trade was 160,500 shares at $18.96
- After hour trade of 24,018 shares at $18.96
- After hour trade of 137,900 shares at $19.97
I have always viewed these larger last and after hour trades as:
- MM's balancing trades among themselves as they 'make a liquid market' and 'manage prices'
- Arranged sale to a larger fund/institution as the MM accumulated over a day or more on their customer's behalf
Regardless, I see this action is bullish as there is higher volume and definitely interest.
Finally, if anyone is watching the daily short %age trading, it has ticked up to 31% the past two days from 25%................although it has been higher in the past.
Things are afoot...............and out of the ordinary.
Keep in mind that GTAT's 2Q 2014 will have a much higher backlog as they are now taking orders on larger furnaces and other equipment.
I also have been saying that GTAT was going to have some 'ugly quarters' but I also believe in the long term story which in my mind has only gotten better with news of the larger furnaces, Hyperion cooperation, SiC, graphene, etc., etc.
Edgx was the Market Maker and seemed to want to keep HIMX below $8.00 with the huge block at $7.99.
Very bullish to see the shares eaten up very quickly as HIMX traded over 2 million shares in the first hour of trading.
Hey jdunef: Do you know what is going on? Are you still waiting for $4 to $5 before buying? How did you reach those valuations?
You were wrong as you were dealing with generalities. This part from your note is also just plain wrong as GTAT has a contractual obligation (to be quiet as per NDA, to manufacture and supply sapphire).
Apple also contracts out operations and does very little manufacturing themselves (Foxconn, GTAT, etc.). GTAT operating this for Apple helps pay their R&D and spreads other fixed costs over a greater amount of sales. It certainly helps them in buying raw materials at a great economy of scale so manufacturing for Apple helps GTAT in other areas (like better margins in their other operations).
Finally, you have information concerning GTAT's contact with Apple..........you know the amounts, the details, etc., etc. What exactly is it you wanted.........and how do you know Apple gave that data to GTAT?
From your nonsense post:
"I don't really give a damn about a NDA. I'm a shareholder and entitled to information that is an impact to my investment. Not getting it all.
I say just sell the Mesa operation to Apple if they have their foot over them and walk away. GTAT doesn't need all this. Yes,they need the money, desperately, but they also Ned to be able to do what they do best, and do it without being anyone's puppet.
Get it up and running, then take the money and run"
READ MORE AND POST LESS!!!!!! Try to actually contribute something. But, if you do want to take responsibility for bad advice, offer to pay losses!!!!!! Anything else is just hot air.
You never answered how you arrive at a value of $4 to $5 for HIMX. The trailing 12 months earnings are $0.40 and they have that $12 million gain coming along with paying a good dividend.
I'd be willing to wager shares never get to your $4 or $5...............which will be done with selling Puts.
Found it. Interesting and I will have to do more research.
So, this won the best choice award at the Taipei computer show?
What else do you know about this? Release date, etc.????
Great find as is usual for you. But, I could have guessed this as China should like the idea of 'free' energy after signing a half trillion dollar gas deal with Russia.
The lower pollution is a great bonus for China............and should increase the efficiency of the solar panels :-)
But, I suspect this is the old buy vs. rent decision. China can either go solar where at some point, they get lower cost energy...............or forever be an importer of oil and gas. Pretty much a 'no-brainer' to me. Their only other realistic option would be to go nuclear...............and while they are to some degree...............they need solar also.
I also value your industry and technical input.
Have you priced GTAT Put Options. Selling them is a bullish bet. You may or may not get the shares..........but you get to keep the premium regardless.
Right now, the price you would get for selling $17 Puts is around $3 for Jan 2015 and $5 for Jan 2016. As GTAT should be well above $17 on these dates, you will keep the $3 and $5 premiums..........and hold the cash starting from the day you sell the Puts.
If the share price drops for whatever reason, you are better off getting shares put to you in Jan 2015 for $17 (less the $3 for a net price of $14) or Jan 2016 (less $5 for a net price of $12) which is far superior to paying over $18.30 today.
Check selling Put Options this weekend and take advantage before the prices change.
If you want the share Put to you, you might want to sell the $20 or $25 Puts for Jan 2015.