Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Himax Technologies, Inc. (ADR) (HIMX): Have You Ever Heard of This $3 Stock? If not, Then You’re Missing Great Returns

Page 1 of 2

I’m not too sure whether many analysts, investors or bloggers are aware that a company known as Himax Technologies, Inc. (ADR) (NASDAQ:HIMX) even exists, even though its products are embedded within devices that make us feel that we live in the 21st century. As a maker of display drivers for monitors, notebooks, TVs, tablets, smartphones, cameras and what not, there are high chances that Himax has touched our lives in some way or the other.

Himax Technologies, Inc. (ADR) (NASDAQ:HIMX)Despite this, it seems that the stock doesn’t garner much interest on the Street, as evidenced by an average 3-month volume of around half a million and coverage by just three analysts. But those who are ignoring Himax as an investment are losing out on solid returns.

Time to take note

When I had covered Himax for the first and the last time a year ago, there were solid indications that the stock could deliver great returns. It has vindicated my views by appreciating close to 90% since then and also pays one solid annual dividend depending on the profit earned in the previous year. What’s more, even after such a terrific rise, it trades at a trailing P/E of just 9.6 times and has a very impressive PEG ratio of 0.53.

As you can see below, Himax’s revenue and earnings have risen consistently over the past couple of years. Analysts expect earnings to rise further as a forward P/E of just 7 times would have us believe. Moreover, Bank of America Corp (NYSE:BAC) reaffirmed its “Buy” rating on Himax shares and even raised its price target after the company posted a solid fourth-quarter.

HIMX Revenue TTM data by YCharts

Diverse clients and products

Clearly, there’s still opportunity for potential investors to jump onto Himax as it still has a lot of fuel to fly higher. The primary reason why one should consider buying Himax, apart from its cheap valuation, is its strong clientele. Its presence in a wide range of consumer devices associates it with well-known brands such as SamsungApple Inc. (NASDAQ:AAPL), Dell Inc. (NASDAQ:DELL), LG Display Co Ltd. (ADR) (NYSE:LPL), AOC and many more in some way or the other.

Himax supplies its drivers to Wintek, which is famous for manufacturing touch panels for the iPhone and the iPad. Apple’s defection to in-cell touch display technology proved to be a headache for Wintek, and Apple as well as they resulted in production constraints. However, Wintek is still a supplier for the iPad and it received a massive boost before the launch of the iPad mini. Going forward, it seems Wintek is readying touchscreens for the next iPad and this is good news for Himax.

Moreover, the iPad is now growing at a faster rate than the iPhone and Himax, with its Wintek partnership, seems well-positioned to ride this growth. But Himax’s prospects aren’t limited to just Apple. The company supplies drivers and power solutions to television display panel makers such as Samsung, LG, Innolux etc.

In addition, increasing sales of smartphones in China are proving to be tailwinds for Himax’s business and its margins. The company’s small and medium-sized display drivers, which are used in smartphones, tablets and automotive displays, jumped 50% from last year and now constitute around 45% of its total revenue.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!