This is going to be less important to OmniVision than the smartphone market, where it’s going to have a more uphill battle against Samsung and other suppliers — Samsung, of course, being the world’s largest smartphone maker in its own right. A major reason for the company’s huge share-price plunge over the last two years is uncertainty surrounding its placement in Apple’s iPhones. Now another source of uncertainty is the limits of Apple’s market potential in a mature and increasingly commoditized smartphone market. Fellow Apple supplier Cirrus Logic, Inc. (NASDAQ:CRUS), which is almost entirely an Apple play, has also seen its share price sink right along with the iPhone maker’s, showing the obvious risks of investing in what’s essentially a leveraged Apple play:
OmniVision needs more Apple growth to keep its score (and its fundamentals) moving in the right direction. It’s unlikely to get big orders from Samsung, and there’s no second-tier mobile maker that looks ready to break into the big leagues with OmniVision riding its coattails. The company looks good now, but the next few weeks will be very telling. If Apple underwhelms Wall Street, it’s likely to drag OmniVision and other dependent suppliers down with it.
Putting the pieces together
Today, OmniVision has many of the qualities that make up a great stock, but no stock is truly perfect. Digging deeper can help you uncover the answers you need to make a great buy — or to stay away from a stock that’s going nowhere.
The article Is OmniVision’s Stock Destined for Greatness? originally appeared on Fool.com.
Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter @TMFBiggles for more insight into markets, history, and technology.The Motley Fool recommends Apple. The Motley Fool owns shares of Apple and Cirrus Logic.
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