​Lower TP but reiterate BUY: Casetek’s share price has been moving sideways for the past two months to digest the impact of MacBook production delays. We believe this earnings downside is already priced in and the stock should rebound in 3Q16 as revenue momentum returns. We also believe its industry position & 2017 outlook are better vs. peers, due to MacBook casing upgrade and likely iPhone order gains in 2017. To reflect the MacBook delay and lower margins, we lower our 2016/17F EPS estimates by 22%/15% and our TP to NT$150, now based on a 2017F P/E of 10x. As it is trading at 9x/8x 2016/17F EPS with 7% cash dividend yield, we view risk-reward as favorable.
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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