Iqe Share Discussion Threads

[desperate dan] 26/7/2017 22:25

Importantly, traded daily volume has risen significantly since the trading update on the 20/07 (see below).

Shorted trades have been sold and the price continues to rise directly into the short seller's face. Possibly understandable as a hedge ... but??

[kazoom] 26/7/2017 22:19

Not disagreeing with you at all bocase, but it's just a tad amusing that we shouldn't be interested in the daily twitches , except of course when they appear to show a positive story. ;-)

[bocase] 26/7/2017 22:07

I can see no sense in shorting IQE. There are plenty of companies out there that have REAL competition and margins that are being eroded due to lack of barriers to entry.

Short positions are inherently dangerous especially with growth companies as each 1% rise causes more and more pain as the mathematics work against the shorter. For the long investor, each 1% is worth more and more as the price increases.

Yes IQE may get ahead of itself from time to time but as Warren Buffet says: "If you want to invest to get rich quickly then you will probably succeed in getting poor quickly." We should look at the larger picture and not worry about the daily twitches.

It was interesting though, today, to watch the daily twitches on the level two order book. Whenever the price fell a little it was met by immediate buying and that is a very good sign of investors waiting to pick up stock at the best price they can.

[tonsil] 26/7/2017 21:49

There will come a point in the share price when it will be tempting to bail out for a good number of people and if through a short position one can increase investor anxiety (nobody here knows what the share price has to fall to for it to be in the money) then it sort of makes sense. The very existence of the short position has a number of people on this board looking over their shoulders with a nervous twitch. It sounds to me that the shorts are succeeding with the first part of their strategy and when there is a negative swing it will oscillate more wildly.

[maxwellsdemon] 26/7/2017 21:20

Aixtron: Revenues and order intake continued to increase in Q2/2017

Total order intake including spares and service in H1/2017 came to EUR 128.5m, 34 percent higher than in the previous year (H1/2016: EUR 95.5m), reports deposition equipment manufacturer Aixtron.

Sequentially, order intake improved by 8 percent to EUR 66.6m Q1/2017: EUR 61.9m). This development was mainly driven by improved demand for Metal Organic Chemical Vapor Deposition (MOCVD) systems for VCSEL (Vertical-Cavity Surface-Emitting Laser), Red-Orange-Yellow (ROY) und specialty LEDs as well as power electronics and Chemical Vapor Deposition (CVD) systems for the production of flash memory applications.

[lpavlou] 26/7/2017 21:18

Guys, don't take these funds for mugs. I'm sure Ennismore we're short when the share price was in the 20p's. My view Is that they have a position just below 3% and this is a hedge to protect part of their holding.

[bocase] 26/7/2017 21:08

Re. Shorts

All good explanations but we need not fear the short positions as the stock has already been sold. Either they will continue to lose more money as the price increases or they will close the short position and the only way to do that of course is by buying back the shares (good for us)

I think the most likely explanation is an emotional attachment to the position, ie they believe or more likely just hope that it will come good in the end and have not had the will power to accept the loss. ( I am sure we have all been there..certainly I have and it is just wrong as grabbing the first profit instead of letting the power of compounding do the work for us.) A successful trader's account will have many small losses and a few very large winners.

A short squeeze would be nice but at the end of the day the share price will be driven by earnings and future prospects.

[sweenoid] 26/7/2017 21:04

. Totally edited post , why bother?
S

[kazoom] 26/7/2017 20:32

No specific knowledge of what ennismore are up to but I think generically if you have conviction on your valuation, then when the price moves against you (and you retain your conviction) is precisely the time to increase your position, not to close it.

On the other hand I can offer options 4 & 5 (not suggesting I agree with them).

4. They are doing a pairs trade against another stock or market which they will outperfom IQE - whether the market overall goes up or down. IE a classic hedge.

5. They are insuring themselves against something - hypothetically if there is some kind of "black swan" event that might cause another stock to fall 10% but would cause IQE to drop 50% this could be a rational piece of insurance.

As I say I'm, not claiming that either of these necessarily apply, but I just think it's too simplistic to assume that a short position means that they expect / want / are trying to force , the price to go down.

[drobinson1991] 26/7/2017 20:31

Short selling is done for a number of reasons which can include diversification, hedging or even an arbitrage strategy. As well as this it could also be done via algorithms or even a strategy that shorts stocks that have risen by a certain percentage over a number of days etc. What you have to be careful of shorting is that there is a limited upside gain (price falling to 0, which will never happen) but an unlimited, infinite loss. When they try close out these positions it can become a very complicated game especially if there is limited liquidity (which isn't the case at the moment. Which could be why they decided to give it a punt). I keep an eye on the shorting activity and it isn't high at all IMO. I have also seen in the past where specific portfolio managers can hold a grudge on a business and will ride it out no matter what. I remember not so long ago an investment research analyst at Liberum capital who slated ARM holdings giving them a poor outlook all the time and look what happened to them!!

[bocase] 26/7/2017 20:15

Tangler 42: Yes I have been wondering why such a large short position was not closed when the price moved so far against it. It is inconceivable that professional traders would not employ stops. The first rule of trading is stop out your losers and run your winners as most of us are doing with IQE.

I too would be interested to hear other's views on these shorts.

[tangler42] 26/7/2017 20:05

Would be interested to here peoples thoughts on why ennismore and another have recently increased/opened a short position against IQE. Obviously to make money! Possible reasons might include 1. They expect share price to drop. 2. They hope to force share price to drop. 3. They are being paid to achieve 1 and 2 by a third oarty perhaps intersted in building a position at a lower share price.
I find this increase very confusing and is completely at odds with IQE's well reported prospects and related share price. What a fair share price is based on those prospects i do not know.
I am a long term holder who averaged down his share price to 23p after buying after intel rumours many years ago. Consequently i now have a very significant (for me) holding so i have a vested interest in share price remaing at or increasing above current share price.
Anyhow would value other peoples thoughts. Thanks.

[desperate dan] 26/7/2017 19:51

Wow Shavian, that's incredible!

That guy's voice is even more annoying than Piers Morgan.

Now, that really is quite a claim to fame!

[shavian] 26/7/2017 19:08

Does anyone know If IQE supplies Himax (NASDAQ HMAX)? This is thought to be the 'iPhone Killer' $7 fabless semiconductor firm which is subject of a rehashed Angel Publishing puff-video. If you can bear it, watch this:



However, it strikes me that the real winner in this field might just be our old friend IQE! If augmentted reality can spell the end of the smartphone (really?) then its best to be in at the bottom of the supply chain with a real 'picks And shovels' stock which supplies all these smart-ass fabless component firms - IQE! Go figure.

[sweenoid] 26/7/2017 18:15

Sheep-bare in mind I am an ex-medic and now a student of history, your posts can be technologically challenging even for the clued up.

In my own mind I try and simplify things-it helps. For me the RF power market will be won by companies who solve the 'parasite channel' issue when you top silicon or silicon carbide with Gallium nitride- for novices like me ( and others) that parasitic channel 'shorts' the system and makes the combo inefficient.

WHOEVER AND HOWEVER that issue is solved leads to the big $$$dosh, like everything else in existence companies are spending big money and there IS competition, using different methods to 'solve' it .IQE have all their eggs in the proverbial basket ( and ours in this arena) on patented cREO IP) . It appears to work well- inserting a layer of cREO between the silicon and GAN renders the parasitic channel inactive- it sorts out the short.

Next to your question , who are we working with - well the big player for us WILL be Macom , I do not think there will be exclusivity, but Malcom are the only 'named' partner in RF power at present, my guess is Infineon and Qorvo will also be aboard- that's a gut feeling . The CEO has waxed lyrical about The Malcom partnership generating massive returns in the future, he reiterated that in June. Malcom themselves think it will be TRANSFORMATIVE To their revenues within a few years ......

Sorry if that's not what you want, it's certainly not techie-speak
S

[sheep_herder] 26/7/2017 17:49

So sweenoid, can we start a conversation about GaN power companies?

There are the usual companies like Qorvo, MACOM, Infineon and TI. Also, GanSystems and EPC seem to have products available.

The main issue that has prevented widespread adoption so far seems to be that it has taken time to develop the enhancement-mode normally off devices they need. In the limited reading I've done, there seems to be people supplying monolithically integrated drive electronics with the power FET which offers performance benefits due to reduced parasitic inductances. I would think that cREO offers advantages here too in enabling integration of drive electronics.

What have you looked at so far?

[sheep_herder] 26/7/2017 13:31

Tommy, that SPI sensor is just a low light CMOS design. It has nothing to do with IQEs core technologies.

IQE produces Indium Antimonide wafers for IR applications, although there is research around covering down to 400nm, I haven't seen IQE mention this yet. Have you found anything?

[agaudry] 26/7/2017 12:45

Too right .... thanks to you for all your excellent info re.iqe and this sector of the market ....

[rutter] 26/7/2017 12:41

Thanks again sweenoid. Crikey, what a future

[sweenoid] 26/7/2017 12:36

Thanks Xylos for that and others for answering my question on the VCSEL TOF camera autofocus solution :-)

So the 'vertical' guys like Finisair ( vertical meaning they do the epitaxy, produce the wafer, then manufacture the chip) simply will NOT have the in-house capacity to ramp up to anywhere near adequate volumes, AND the outsource guys ( those that buy in the VCSEL wafers) like ST Micro and then produce the chips are likely going to be beholden to the best and biggest supplier AND the ONLY one who does 6 inch wafers. It's a total win-win for IQE.
The brokers have IQE ordering £15million worth of 'tools' to kit out the new factory in Newport-an order based on assured demand. IQE said this "In parallel, the Group has placed orders for new MOCVD equipment"
Now IQE as attendees at the AGM can tell you ( those that went on the tour that is ) buy their MOCVD reactors from AIXTRON - I actually asked CHRIS Meadows how much each reactor costs , but have forgotten the answer-i think it was circa £1.5-2 million. IQE actually 'tweak' the reactors after they are fully installed to their own secret specification that ensures the best quality and highest yield on wafers.

This would 'suggest' IQE are in the process of ordering something like 10 reactors!! , these things work 24hrs a day, that sounds mouth-watering in terms of volumes. I know the myopic will groan at the extra Capex especially as it's over and above the extra amount spent last year, but the capacity increase IS the big story here.IQE are reacting to assured business orders AND acting proactively to ensure they stay ahead of the game.
Exciting innit
S

[tomyumgoong] 26/7/2017 12:16

Sheep Herder,Just as an example......https://petapixel.com/2015/12/03/this-is-what-a-color-night-vision-camera-can-see-in-near-darkness/

[tomyumgoong] 26/7/2017 12:12

Sheep Herder,I'm talking visible light not IR which gives a sort of black and white image......I'm talking full colour images at night without any other illumination source!

[a0469514] 26/7/2017 12:05

Someone I know works for the biggest electrical component distributor in Europe and it appears STMicroelectronics have taken a ‘massive’; order (believed to be from Apple) and that all Microcontrollers will be on allocation from next April, and they are getting in touch and sending out emails to ‘all of their most loyal customers’ basically saying, you better stock up with these now as ‘someone’; is going to be taking all production really soon. (So basicaly, sorry loyal customers, someone else has made us an offer we can't refuse).

In addition, ST’s top man says Tesla had just placed an order for 400,000 chips, which means they will have to ramp up production from 5000 – to 50,000 wafers per month. And no-one else will get any as they (Tesla) are taking the lot. So that sounds like two mega orders in the pipeline for ST. The market is incredibly buoyant anyway. Distributors are making loads of money. Lots of stuff going on allocation everywhere, stock scarce, prices go up, the distributors make money.
All that evidence indicates, of course, that the state of the market will be incredibly good for IQE. They may or may not supply ST but whatever, it shows again that they are going to have a very good year as the leading outsource supplier.
Xylos

[sheep_herder] 26/7/2017 11:56

Tommy, we've had night vision tech for years and it's already in every tank, plane, etc. Even infantry and police forces have night vision goggles. They use IR in order to construct the image, not visible light.

I had assumed the Raytheon connection was for high power transistors for radar applications but I can't say I've looked. Wouldn't be surprised to see them working on multiple fronts including IR.