Stock price up 50% in past 12 months; still trades at 10x 2017F EPS
​We lift our BUY TP to NT$45; investors can still expect a 15% total return with the inclusion of an upcoming cash dividend (going ex-div for NT$2.4 cash DPS on Aug. 25): We have cited GM expansion and market share gains in overseas markets as the key fundamental growth drivers for Greatek. For reference, while we expect GM expansion to slow into 2017F, we still think the stock is suitable for value investors here, even though it has already enjoyed a stellar share price run. Our new TP is based on the average of 1.7x 2017F BVPS (previously 2016F) and 11x 2017F EPS (previously 2016F).
Greatek Electronic is principally engaged in the provision of integrated circuit packaging and testing services. Co.'s packaging products include plastic dual-in-line package, small outline package, small outline J-lead, shrink small outline package, thin shrink small outline package, mini small outline package, quad flat pack, low-profile quad flat package, thin quad flat pack, plastic leaded chip carrier, diode ICs and quad flat no-lead package. Co. operates mainly in Taiwan, United States, Asia and Europe.
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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