Mixed 1H16; buy for the 2H16/2017 recovery
​The analyst meeting was a mixed bag with good 1Q16 results on strong GM, but a weaker than expected 2Q16 sales outlook. We lower our TP to NT$3,050 from NT$3,150, as we trim 2016F earnings by 2%. Largan's share price is likely to stay volatile in the near term on a weak April & May. However, we stick to our positive thesis (dual camera, 6p) and expect a pick-up in sales/earnings in June/2H16. We suggest accumulating on weakness. Largan today indicated that all of its big customers are developing dual cam for 2H16 launch, and customer’s design-in is aggressive at the current stage.
Largan Precision is engaged in the design, research, development, manufacture and sale of optical lens, camera projector, field glasses, microscope, scanner, viewfinders, camera lens module, mobile phone lens, object lens, mouse lens, digital camera and related spare parts; and the provision of after sales services.
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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