Expecting a strong 2H16F; 1Q16F should strike bottom
​2016F sales will still grow 3% YoY (3Q16F sales could grow over 30% QoQ with sequential growth into 4Q16F) with EPS of NT$2.4. Stock is cheap at 8x P/E, 1x P/B with 13% ROE and 6% cash yield. We suggest buying after 1Q16 results to position for 2H16F growth. Compeq’s share price has dropped 19% YTD (vs. the TAIEX up 2%) due to ongoing turmoil with iPhone shipment outlook (iPhone accounts for 25-30% of Compeq’s sales). However, we believe its earnings will reach bottom in 1Q16F, and thus suggest investors to buy after its weak 1Q16 results to position for its 2H16F growth and cheap valuation.
Compeq Manufacturing is engaged in the manufacture and sale of multi-layer printed circuit boards for computer use and product related services. Co.'s application of main products include: (i) computers: desk-top PC, laptop, work station, server and other computer peripherals; (ii) networking: hub, switch, router and other network equipments; (iii) telecommunication: mobile phone, base station and other telecom equipments; (iv) consumers related: LCD monitor, DSC, PDA, GPS and other consumer products; and (v) IC substrate: CPU, ASIC, MCU, system chipset, GPU and other IC packaging substrates.
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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