pick list earnings, AES correction & NMRK record date? ?3

09:26 08-Nov-18

BGC Partners and Newmark have filed identical 8-Ks which include the following text:

Newmark will repay the $300 million outstanding aggregate principal amount under the BGC Note (as defined below) using primarily proceeds from the sale of its 6.125% Notes, on the earlier of the date that BGC distributes, or spins-off, to its stockholders all of the shares of Class A common stock and Class B common stock of Newmark that BGC owns or December 5, 2018.

I think this statement is meant to give us an indication of the intended distribution date, though as with similar hints surrounding the IPO, nothing is certain.  I was privately surprised that management said it would give a distribution date "upon the successful completion of Newmark’s refinancing of debt owed to BGC."  If it were to adhere to the letter of that statement, then I would expect something more definitive shortly, as the refinancing is complete and only payment remains, in my view.  Regardless, it looks like we can expect a record date in December.

Moving on to eMagin third quarter earnings:

• I calculate a loss of 3 cents per share, which is in-line
  
• on revenue of $6.9M, which misses by $200K
  

My EPS number is after deducting $1.3M for warrant revaluation, which management should have done, rather than only providing the breakeven number which includes the $1.3M.  Military applications are promising, and inclusion in new medical devices even more so.  However, I think the only thing that could make this stock a worthwhile investment is mass-production or buyout.  To that end, design approval was received from a tier-1 partner, with prototypes expected in early 2019, but management's own statements also indicate that production quality is a moving target.  With both JOLED and BOE already demonstrating inkjet printed televisions, I think it's just a matter of time before resolution improves sufficiently.  eMagin burned about $2.5M last quarter and had about $6.2M in cash at the end of it.  Gross margin did improve, and it is possible that dilution could be averted.  I am listening to conference call now, but I doubt I will write more, especially after having to second-guess financial figures.

Himax also reported earnings this quarter:

• EPS of 3 cents beats by a penny
• on $188.4M in revenue, which beats by $4.4M
• 4Q revenue guidance for up to 5% QoQ growth, misses by $4M at the mid-point
  

HIMX shares are down modestly in the pre-market, but Samsung also teased its foldable phone this week, and others are on the way as well.  I've said all along that I expect foldables to reinvigorate the mobile market.  The timing in conjunction with increased CapEx for the ToF sensing solution that will compete will with some of MicroVision's plans will make the next few months tricky for HIMX shares, but any further declines would be interesting.

Finally, a correction on Tuesday's AES report is that AES and AIMCo each sold 24% of their 50% stakes in sPower to Ullico, for a total of 24%.