Iqe Share Discussion Threads

[sheep_herder] 23/3/2017 10:23

Can anyone remember where management have previously stated their current fab utilisation? I remember reading it somewhere but can't find it now.

The reason I ask is that as they start to fill that unused capacity, their profits will spike. The costs for running the fabs are fairly independent of utilisation.

[someuwin] 23/3/2017 10:19

Nice move.

[yump] 23/3/2017 09:11

Taking a very simplistic view and assuming photonics is the driver and other revenue and costs stay the same (whether potentially up or down)...

Adjusted profit from photonics rose from 27% to 30% of revenue, 2015-2016.
So assuming its geared, say 35% of revenue next time.

Assume revenue of 33mln ie. accelerating a bit.
So revenue would be 16mln - 22.8mln - 33mln.
(+42% - +45%)

35% of 33mln is 11.5mln, which is an increase of 4.6mln.

Stick that on the PBT and you get about 23.5mln PBT, which is around 3.5p per share earnings.

[someuwin] 23/3/2017 08:11

Great post.

[rivaldo] 23/3/2017 07:21

Lots of detail here re Peel Hunt's upgrade:

http ://www.proactiveinvestors.co.uk/companies/news/175206/iqe-s-track-record-of-growth-will-continue-peel-hunt-says-as-it-upgrades-stock-to-buy--175206.html?utm_source=Sign-Up.to&utm_medium=email&utm_campaign=7163-363653-Daily+newsletter

"IQE's track record of growth will continue, Peel Hunt says as it upgrades stock to 'buy'
09:57 22 Mar 2017

Peel Hunt has upgraded IQE to 'buy' from ‘hold’ and raised the target price to 60p from 35p after the company impressed the broker with its annual results

The stars are aligning for IQE plc (LON:IQE) after the semiconductor firm reported full year profit and revenue growth, Peel Hunt said in a note to investors today.

The company yesterday reported a 16.4% increase in revenue for the year ended 31 December to £132.7mln, compared to £114.0mln the previous year, driven by growth in its photonics business. The group also achieved revenue gains in its wireless and infrared divisions.

Adjusted pre-tax profit increased 17.4% to £20.6mln from £17.6mln.

Peel Hunt upgraded the stock to ‘buy’ from ‘hold’ and raised the target price to 60p from 35p following the results.

“The tripling of the share price in the last year is justified by a reversal of the revenue decline in wireless and a 30% like-for-like increase in photonics revenue,” Peel Hunt analyst Andrew Shepherd-Barron said.

“We believe there is more to come from photonics, and with other big opportunities also making progress, several developments could be coming good in the next 1-2 years.”

The photonics business accounted for 17% of group revenue. Wireless, which represented 72% of group revenue, reported a 4% increase in like-for-like revenue following two years of volume declines as 2G products reached end of life.

Barron said the company’s 15% increase in adjusted fully diluted earnings per share (EPS) to 3.0p was ahead of expectations. Subsequently Peel Hunt has upgraded its EPS estimate for fiscal year 2017 to 3.1p from 2.9p and hiked its forecast for 2018 EPS to 3.4p from 3.2p. The broker said IQE’s track record of growth will continue into the future.

“IQE has now proven that its market leadership translates into profitable growth, with EBIT margins of 30% in Photonics and 20% in Infra Red, and there is no reason to think that if revenue takes off as we hope, it will not be sustained."

[lucas5950] 23/3/2017 00:38

As they say... show me the money!?

[lucas5950] 22/3/2017 18:54

The rise to 57p in Feb 2011, it then took until Dec 2011 to fall back to 18p.

[toptrump1] 22/3/2017 18:49

Takeover tosh!

[bobd29] 22/3/2017 18:49

Don't trust the trades listed, at these volumes there must have been a lot of heavy buys for the share price to rise. If the recent historic rise in share price was from an oversold position then fretting about the scale of increase is pointless imo. Current share price justified by results and outlook imo so I am looking for 60p+ this year excluding any bid talk (which in my opinion is unlikely), would buy on any fallback.

[lucas5950] 22/3/2017 18:24

P.S - never bought at the bottom, about 26p actually ;)I agree with Toptrump, I can see this settling around 40p region.

[lucas5950] 22/3/2017 18:22

Just because some have exited doesn't mean we will not monitor performance and keep an eye out. I sold out because the share price is too high. Do you think the FY results justified all the hype and share price value? It was 54p day before results right? Unfortunately that was the top and many others sold out that day too. It's about assessing and determining value when you see it, there will always be the ones that agree and disagree. I will definitely be buying back in, hence why IQE is on my radar, but after seeing the FY results, definitely not at this current share price

[grity] 22/3/2017 17:26

Good move someuwin , wished ide
Topped up on that pullback. Will
Be adding soon though. 10m trades
Again !

[panic investor] 22/3/2017 17:24

Unless it gets bought out of course - but other than that agreed

[toptrump1] 22/3/2017 17:08

It was only yesterday! You likely have several months before further news

[spursspurs] 22/3/2017 17:05

lucas and others no longer invested, why dont you go and be so wise on boards where you are invested, if you are not part of it we dont care , if you are out, great, go and do something useful, of course you will have bought at the bottom and sold at the top- well done!!

[lucas5950] 22/3/2017 17:00

definitely overblown. I agree, possible short term increase, but not worth the risk for me.

[lucas5950] 22/3/2017 16:58

Toptrump - i am in complete agreement with you on the outlook of IQE. Not sure where sense is not being made??

[toptrump1] 22/3/2017 16:53

I may not buy back as I wasn't impressed by the reduction in earnings and lack of net cash generation, iqe is not an early stage co it has been around for a long time.

[toptrump1] 22/3/2017 16:41

Now you're not making any sense Tw
Lucas, if you read the thread and the other one you get a good idea of what people think. I think it has overblown for now based on what was expected etc and think it will settle back to around 50 before next leg

[someuwin] 22/3/2017 16:18

Bought a few more now the results excitement seems to be receding.

[lucas5950] 22/3/2017 16:16

i guess no one will answer my question...

[twatcher] 22/3/2017 16:01

Your weeks ago conclusion resulted in you not selling until a few days ago...makes perfect sense :)

[toptrump1] 22/3/2017 15:58

So r u saying it's the very top now? You don't make any sense

[yump] 22/3/2017 14:53

... and after all the time spent talking about the tech., which is all very interesting, it took poombear to actually post something of real use in the way of figures. It only took a few lines as well.

Given a bit of time, I'm sure its possible to extrapolate some of the photonics figures and the capex and get to some sort of estimates that aren't entirely dependent on the whims of brokers, or someone assuring everyone that the future is bright.

Perhaps someone will start an info. thread - as in useable info. for the purposes of working out where the business is actually going.

At this point some clues on the likely movement of wireless revenues might be handy - I've been digging a bit but it hasn't really revealed anything of use. Part of the increase in wireless, apart from currency, must have been last year's increase in Skyworks. Presumably that hasn't gone up or down by much for this next year, as no announcements.