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zhuge_liang
Supreme |
01-Jul-2006 20:53
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Handset pullback is more severe than expected. Citigroup is cutting its estimates by 12-21% over 2006-08E to reflect lower volume assumptions for the handset business. It forecasts '06E EPS declining 16% yoy (ROE to fall from 28% to 19%) and 3% EPS CAGR over 05-07E, sharply lower than consensus expectations of +15%. Hi-P has seen handset volume decline rapidly, due to lost market share and a slowdown in end-market demand. Utilization at its Tianjin plant has now fallen to ~30% from +70% in 1Q06, thus 2Q06 and 3Q06 look set to see continued consecutive sequential sales decline, not acceleration. With the slowdown in activities, start-up costs are not likely to reduce in 2H06 due to aggresive capex this year ($110 m). Pricing pressure has also intensified, attributed to the rise in resin prices. Its operating margin is estmated erode further by 5.1% to 10% this year. Hi-P is benefitting from Gillete and Whirlpool product launches, but is not sufficient to offset softness in the handset business. It has cut its price target by 30% to $0.80. |
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Nostradamus
Supreme |
19-Apr-2006 00:52
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Issued a profit warning and guided for 1Q06 profit of $14 mln, suggesting severe margin pressure. Appears to be struggling with its aggressive product roadmap as it simultaneously launches new products/services. Startup losses can't be discounted. At $1.20, it was trading at 06 PER of 15x with decline in profit and ROE set to fall sharply 28% ('05) to 21% ('06E). Long term investors may become disillushioned with a 2nd consecutive year of flat earnings and 4 straight quarters of earnings disappointment. |
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scotty
Senior |
01-Mar-2006 09:48
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Hey gallen, Since you post so often... how about you just do a daily summary on your buy-sell recommendations for us? |
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Gallen
Senior |
01-Mar-2006 01:38
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Results commentary and TA at http://kelongstocks.blogspot.com For China Essence, posting will be available tomorrow at 8:30am |
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