Strong fundamentals for 2016/17F still to be factored in
​The market is worried that sales may have peaked in April this year and that the company may lose steam in 2017F. However, our view is that earnings momentum in 2H16F remains strong HoH, while Arcadyan enjoys good client relationships and is penetrating into new markets. We believe 2017F sales may further see double-digit growth and hit a new high. Despite the recent share price pullback, the company’s strong fundamentals are still intact, or ever better. We raise our 2016F sales/earnings estimates by 3%/8% (now up 24%/116% YoY), with EPS of NT$6.6, as channel checks indicate stronger than previously believed fundamentals. We believe the current P/E of 8x is undemanding, coupled with likely robust growth in 2016/17F, and greatly reduced impact from euro fluctuations, we reiterate BUY. Our TP of NT$72 is derived from 11x (unchanged) fair P/E based on 2016F EPS estimate of NT$6.6
Arcadyan Technology Corporation is a Taiwan-based company principally engaged in the research, development, manufacture and sales of wireless local area network (LAN) products and broadband wireless gateways. The Company's main products include wireless LAN products, integrated digital home and mobile office multimedia gateways and wireless audio and video products. The Company distributes its products in domestic market and to overseas markets.
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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