Himax news and website changes +3

08:29 28-Dec-22

Himax continues its CES media blitz by highlighting the debut of a smart office solution from Wentai.  It goes beyond motion activated-power management to report office head count and locations from the network edge, thereby reducing network usage as well as power usage.  I anticipate that systems like this and security applications will be a slow build in terms of sales.  However, it drives home the point of HIMX being a uniquely positioned IoT investment.

Himax has announced its full CES agenda, including another WiseEye 1 collaboration featuring a battery operated surveillance camera.  3D Time of Flight Depth sensing vision processors and Wafer Level Optics will also be showcased.

HIMX hasn't traded meaningfully pre-market, but I will look for it to retest the $7 level and possibly extend above that as tax-loss selling melts into a Santa Claus rally.  Beyond that, a return to double digits seems like a reasonable aspiration for the stock in 2023, but that will probably require some sustained earnings traction beginning with the next report in mid-February.

On 12/26/22 12:09, Esekla wrote:

NFE has moved to Yield, after convincing arguments from subscribers, and LUMN has moved to Growth.  Both have updated summaries, as do VUZI, XBC, BGCP and HIMX.  You might need to hit refresh on your browser to see the changes.

The last of these notes ongoing concerns about the independence of Taiwan after passage of the latest National Defense Authorization Act, including TERA, which among other things, authorizes up to $2b per year over the next 5 years in loans for the country to buy American weapons.  China followed that by sending 71 military aircraft into Taiwan’s ADIZ (air defense identification zone) where foreign aircraft are tracked and identified before they reach a country's airspace.  This is more militarily intense than the initial response Pelosi’s visit, which resulted in a high of 68 incursions on Aug. 5th.  Nonetheless, I still have no immediate concern about war in Taiwan.  In fact, I see China abandoning Zero Covid and renewing its push for economic growth as a significant positive for Himax in the short to medium term, though progress is likely to be shaky.

That said, technological advances by Huawei and others toward producing sub-7nm chips represent a long term challenge to Intel's Chinese sales.  Huawei posted a video supposedly confirming the technology, but actual production is still almost certainly at least a decade away.  For the time being, though, China is still clearly able to sacrifice its population for economic efficiency, whereas companies like LG Display, in developed nations like Korea, are halting legacy domestic production due to non-competitive costs.

I hope everyone is staying happy and safe for the holidays!