Competitiveness remains intact; awaiting turnaround in 2H16F
​
The weakness in 1H16 led to the recent share price decline. We believe Senao is just facing a short-term bottleneck as its product competitiveness & client stickiness remain intact. We reiterate BUY as the stock is now trading at a P/E of 10x. We trim our 2016F earnings estimate by 12% and do not expect it to hit a new high. However, we believe the company is just facing a short-term bottleneck as its product competitiveness & client stickiness remain intact. We also trim our 2016F sales forecast by 6%, with YoY growth down to 6%, but we still expect 3Q/4Q16F sales to hit new highs. We also anticipate its share price will hit the trough in 1H16F. We are positive on 2016F GM and expect further GM expansion through product mix improvements.
Senao Networks, Inc. is a Taiwan-based company principally engaged in the development, manufacture and trading of network communication products. The Company's products include four categories, including wireless network system products, wired network system products, enterprise wireless communication system products and network security monitoring system products. Its products include intelligent cloud integrated gateways, wireless network routers, managed network switches and multi-functional home intelligent cameras. The Company distributes its products within domestic market and to overseas markets, including the Americas, the rest of 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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.