1Q16 earnings disappoint on PrismTech restructuring costs
​Adlink fully acquired UK-based software maker PrismTech in 2015, aiming to strengthen its leading position in the industrial IoT market via hardware/software integration, platform optimization & overall innovation of its solutions. However, the high initial restructuring costs have led to disappointing 1Q16 earnings, and we expect this will not improve significantly in the short term. As such, we downgrade Adlink from Buy to HOLD-OPF, with a lower TP of NT$68, based on 25x (unchanged) 2016F EPS of NT$2.73, implying 2.1% upside
Adlink Technology is engaged in the design, manufacture and sale of industrial computer hardware, software, related peripherals. Co.'s products include data acquisition cards, network appliance, embedded flash storage, fan-less embedded computers, processor blade and platforms, rugged servers, controlling modules and other related products.
Yuanta is a Taiwan-headquartered brokerage with a growing presence in Asia, especially across Greater China. Our team of 140+ provides cutting-edge analysis on key sectors, spread across offices in Taiwan, Hong Kong, Shanghai (A-Share), Seoul and Jakarta. With an ever-expanding coverage universe of 400+ companies, we provide in depth analysis with unique local color to investors. Consistently being voted the Best Investment Consulting Firm in Taiwan in the AsiaMoney broker poll is evidence of our strength. We target providing an extensive range of research, from small, to mid-sized, to large cap. We bring you the big, well-covered names, as well as going off the beaten track to research the less-familiar companies.
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