The sleeping lion has awoken
​We raise our 2016/17F EPS forecasts by 3%/5% respectively on a better than expected near-term outlook and higher dual-cam adoption. We raise our TP to NT$3,700 from NT$3,050 on higher 2017F earnings and switch to a target 2017F P/E of 16x (from 16x 2016/17F) to capture its 2017 earnings potential. In our view, Largan’s solid May/June revenues indicate that the iPhone transition has come to an end. While its share price outperformed the TAIEX by 24% YTD, we believe that the robust migration to dual-cam/6p and the contribution from the new fab in 1H17 will serve as catalysts to both earnings and share price in the mid- to long term.
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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