Iqe Share Discussion Threads

[mad foetus] 04/6/2018 20:02

Most likely is that Dave has locked everyone in his camper van and has abandoned them somewhere in the Gower peninsula that doesn't have 4G.

[darkdogs] 04/6/2018 18:33

Looks like everyones still in the pub Davemac

[davemac3] 04/6/2018 17:57

Any AGM feedback or is everybody in the pub?

[fuji99] 04/6/2018 15:06

IMO, this is what is going to change IQE fortunes in the near future:“Our new technologies portfolio, including GaN on Silicon, NanoImprint Lithography (NIL), Crystalline Rare Earth Oxide (cREO), and Quasi Photonic Crystals (QPC), is rapidly gaining strong traction and engagement with key customers "AROUND THE GLOBE FOR A WIDE VARIETY OF HIGH VOLUME APPLICATIONS""
Reminds me of market reaction to ARM each time a launch of a new processor is announced a 7.00am.

[solderflux] 04/6/2018 14:49

“Lack of translating revenue into cash” - where does this argument come from? They have debtor days of around 42/43 which is excellent and miles better than industry average. In the company I work in we have debtor days of 62. Also they made profit of circa £24m and they have cash generated from operations of same value. It’s all in the year end report.

[fuji99] 04/6/2018 14:33

Good volume today. The AGM was well received and the institutions reassured.

[aphrodites] 04/6/2018 14:05

thecrunk

The shorts cannot have stock in their back pockets. They have to report their net position "short".

But they might have bought "out of the money OTC "buy" options" to provide some cover. This would not have to be offset or reported.

[thecrunk] 04/6/2018 14:05

Is it T Rowe lending shares as a broker?

Or is it T Rowe Fund Management trading a strategy?

If its the brokerage arm then you are right snf but its not clear to me under what wing of T Rowe this is occuring.

Anyway this is boring it does not matter.

Focused on Apple tonight and feedback from AGM and Tour.

[suffersnofools] 04/6/2018 13:52

Lol - I'm sure T Rowe are going to want to trash their reputation as a very profitable stock lender to the benefit of IQE longs. However, requests to return shares are rare, as the lender of the shares is a brokerage firm that has a large inventory of stock. The brokerage firm is providing a service to investors; if it were to call shares to be returned often, investors would be less likely to use that firm.Furthermore, brokerage firms benefit greatly from short sales through interest and commissions on the trades. And there is limited risk for the brokerage firms due to the restrictive margin rules on short sales.

[thecrunk] 04/6/2018 13:36

No what I mean is that T - Rowe will have a pre arranged buyer for their 10%.

So they can't sell their own stock to the shorters. They force the shorters to buy from the open market. Pushing up the price. While they offload their 10% to the pre arranged buyer at a pre agreed (higher price) which they have created by squeezing shorters.

T Rowe are not sinply doing this for the interest income on lending out stock.

The shorters will try cover themselves buy buying stock low and holding stock in their bsck pockets.

The real question is how covered the shorts are. That determines how big the bang will be when T Rowe want to sell.

Listen this is one permutation it can play out other ways too depending on the specifics

[monty9] 04/6/2018 13:27

If the shorts are forced to return stock because it is called by T Rowe, they have to buy it from someone. Most likely R Rowe! In other words if T Rowe wish to sell the effect will be muted. If they require the stock for some other purpose the price will rise.

[solderflux] 04/6/2018 13:20

I see T Rowe doing very well at the moment and I think they would want the current play to continue. Two things can change their plans - (1)shorter margins being squeezed and rising risk, and (2) Behaviour of other funds who have much higher entry points and are not making sufficient returns. They could join forces with others funds in similar position and decide to act.

[twatcher] 04/6/2018 13:18

It is just me, or does anyone else see the hole in the the argument that the share price will rise when a 10% holder sells out ?

[thecrunk] 04/6/2018 13:15

Suffernofools.

To respond that simply is the way it works.

T Rowe will sell at some point and when they do sell they will recall the 10% they have loaned out.

Its a simple fact.

The only question is when.

[fuji99] 04/6/2018 13:12

AGM positives filtering through this pm.

[aphrodites] 04/6/2018 13:11

thecrunk

Don't worry, IQE will be taken over and T-Rowe will play an instrumental role.

[suffersnofools] 04/6/2018 13:10

thecrunk - that is simply not how it works. ALL companies have short and long interest. It's just two sides of a coin as has been demonstrated by Ocado and Sainsbury's of late - shorts are just as capable of getting it spectacularly wrong as longs.There are two determinants of the medium and long term SP:1. RAPID profit growth to justify the PE of a growth company - which requires that a) IQE can translate the growth in their key markets and revenues into cash. A point made by BnB. No point in driving revenues in an environment of tightening margins. b) maintaining a technological and competitive advantage to protect said margins. c) developing new revenue streams.2. The wider market and global economy. I've posted my bearish views here several times. I feel this is an area of investing that fans of specific stocks fail to consider seriously enough. I fear something nasty is around the corner and news out of Deutsche Bank does nothing to dampen that.So while I remain positive regarding IQE I am less so re the wider markets.

[thecrunk] 04/6/2018 12:41

I just hope at some point this goes like Ocado.

The only time that will happen is when T-Rowe decide they want to exit.

They will need to recall their shares from the shorters to sell them.

I imagine at a huge holding of more than 10% they will not sell to the market willy nilly. They will arrange a buyer before hand for their 10%.

When that happens I don't know. I would imagine it would be in 2019 once T - Rowe probably think the company has proven itself and they can get the exit they want at their desired price.

Which means ubfortunatley until then we still have the albatross around our neck and are like a small dhinghy being towed behind HMS T Rowe Price.

[richardc77] 04/6/2018 12:40

Don't fret Hyper Al ;)

[hyper ai] 04/6/2018 12:30

hmmm - could close down, which would not be great.

[paradores] 04/6/2018 12:20

Apparent from the statement that visibility is improving, for both near term sales and areas where future revenue growth will be seen. Bodes well IMHO.

[twatcher] 04/6/2018 12:07

The Singer note is stating that the AGM statement is indicating everything is progressing on track, which it does. Therefore one can assume the forward looking statements from IQE are still in place, no re-rating either up and down.

Unsurprising therefore that the two brokers to comment thus far have re-iterated their previous position and target share price

This will remain the case until we get news of extra reactors beyond what is currently known.

[chessmaster10] 04/6/2018 10:10

JamesRowe, it's been quite well documented in the recent updates from IQE customers and others in the VCSEL / 3D sensing space that H1 2018 has been expected to see a breather in demand for VCSELs, before things pick up again in H2 2018.

The iPhone X launch provided a boost last year, now there's a lull, and then things will ramp up again as 3D sensing starts to proliferate.

To me it looks like IQE are managing their production to meet demand where its needed, I see it as a positive. Increased revenues in H2 2018 reflects the fact that VCSELs are higher-margin wafers with respect to wireless.

Look forward to hearing feedback from the AGM today.