Upon formalizing its partnership on the 3D sensing camera with QUALCOMM, Inc. (NASDAQ:QCOM), excited shareholders pushed Himax Technologies, Inc. (ADR) (NASDAQ:HIMX) stock 6% northward yesterday with a continued rise of 5% this morning. As more smartphones and IoT devices become fitted for 3D sensing technology, the market is poised to grow and HIMX and QCOM are getting in early on the ground floor.
Noting that the QCOM-HIMX deal was four years in the making, top analyst Sujeeva De Silva of Roth Capital believes the partnership “represents a significantly differentiated and hardened solution versus competitive offerings.” The analyst continued, “We believe 3D sensing capabilities for facial recognition and augmented-reality (AR) applications is quickly becoming a “must-have” feature for Tier-1 OEMs. As a result, we expect healthy demand over the next several quarters for the combined HIMX/QCOM module solution, which brings strong HIMX optics module know-how together with QCOM computer vision algorithms. While terms were not disclosed, we believe HIMX garners a significant portion of the smartphone end customer economics, given the technology and integration competency it brings to the table.”
Furthermore, in light of QCOM’s investment last spring in Emza and its upcoming third quarter ramp of water level optics for smartphones, the analyst regards sensing “as an emerging area of opportunity for the company.”
As such, De Silva maintains a Buy rating on HIMX stock with a $10 price target representing a near 2% rise over current trading levels.
Sujeeva De Silva has a good TipRanks score with a 66% success rate and a high ranking of #92 out of 4,629 analysts. De Silva yields 20.3% in his annual returns. When recommending HIMX, the analyst loses 0.6% in average profits on the stock.
TipRanks analytics exhibit HIMX as a Buy. Out of 6 analysts polled by TipRanks in the last 3 months, 4 are bullish, while 2 are bearish on Himax Technology stock. With a potential downside of 10%, the stock’s consensus target price stands at $8.83.