After a massive 5% drop in shares of Himax Technologies (NASDAQ: HIMX) last week, the stock recovered and acted as if nothing happened. One analyst whose understanding of the company is poor is the reason for the stock dropping.
Oppenheimer downgraded HIMX stock to “underperform” from “perform” and set a $4.00 price target. The analyst cited uncertainties in the TDDI transition and slow 3D sensing growth as reasons for the analysis. Fortunately, Himax’s investor relations responded with a letter.
The analyst did not bother contacting Himax:
“the Management, have not spoken to the analyst Andrew Uerkwitz from Oppenheimer for three months. Thus, we believe his report recently issued on July 14, 2017 is INACCURATE and MISLEADING.”
Not only is HIMX paying generous dividend to shareholders of record July 31 ($0.24 per ADS), the company is scheduled to report a solid quarter on August 3 before the market opens.
Looking ahead, OLED shipments to major customers will happen before the end of this year. It is already shipping TDDI, WLO/DOE 3D scanning components, and will pick up the shipping volume through the latter part of this year.
Takeaway
Expect a strong rally in HIMX this week and beyond, as investors buy the stock to collect the dividend.