WR Hambrechet on ASE Test
wrhambrecht.com
ASE Test Ltd. (astsf)
Profile
SEC Filings
News
Rating Target
Price Current
Price Market
Cap.
BUY $11.00 $7.21 $714.28MM
--------------------------------------------------------------------------------
WRH+Co Next Qtr. Est. Revenue EPS
Sep $101.0MM $0.03
08.01.03
astsf: IMPRESSIVE Q2 WITH GROWTH IN 2H:03; INCREASING PRICE TARGET TO $11; REITERATE BUY
We are increasing our price target to $11 and reiterating our Buy rating on ASE Test based on 1) our expectation that the company will turn the corner of profitability in Q3; 2) Q3 guidance of 10% q/q growth allays concerns regarding a repeat of last year's inventory build-up scenario; and 3) our belief that 2003 IC volumes are on track to meet or exceed peak 2000 volumes. Full Report - PDF
04.29.03
astsf: 10-15% TOPLINE GUIDANCE ON INCREASED VISIBILITY; MAINTAIN BUY
We maintain our positive view of ASE Test based on 1) our belief that 2003 IC volumes are on track to meet or exceed peak 2000 volumes; 2) steadily improving business trends which is resulting in increased visibility for the company; and 3) our opinion that there is limited downside to current valuation. Full Report - PDF
02.12.03
astsf: RESILIENT Q1:03; GROSS MARGINS GETTING BETTER; RAISING ESTIMATES; MAINTAIN BUY
ASE Test reported Q4:02 results of $75.2 million in revenues and pro forma EPS of ($0.05) vs. our estimates of $75.0 million and ($0.09) and consensus of $75.7 million and ($0.10). Pro forma EPS excludes charges related to goodwill amortization of $2.6 million and asset impairment of $35.2 million. Gross margin came in at 7.3% vs. our estimate of 5.0%. We believe the company's essentially flat revenue growth in 2002 suggests that their top customers performed poorly and also because of the intense pricing pressure. The Q4:02 data suggests pricing has stabilized, and going forward, we believe the company will get its pricing power with high end testers running at 75-80% utilization (80-85% being the bottleneck). We maintain our Buy rating with a price target of $10. For 2003, our topline estimate is unchanged at $349.0 million and EPS goes from ($0.21) to ($0.03). For 2004, our top line is went from $440M to $442M and EPS estimate goes from $0.29 to $0.32. Full Report - PDF
02.11.03
astsf: Expect 7-13% Sequential Q/Q Decline; Reports Q4:02 After The Close; Revisit Model And Price Target After The Call; Maintain Buy
ASE Test reported monthly comps for Q4:02 totaling $75.7M, approximately in-line with our estimates of $75M. Q4:02 revenues declined 5.5% to $75.7M from $80.1M in the previous quarter. We believe our Q1:03 estimate of $73M (3.5% Q/Q decline) is at risk, as ASE Test's top customer, LSI Logic guided down 21% for Q1:03. Also, another major customer Agilent Technologies guided down for calendar Q1:03. The parent ASE Inc, grew 18.9% Y/Y, while ASE Test grew 1.3% Y/Y suggests that Testing operations within ASE Inc. has hit some major bumps in the business. Q1:03 outlook: We believe ASE Test management will guide down to 7-13%, tilting more towards high end of the revenue decline. For Q4:02, we are expecting EPS of ($0.09). For Q1:03, our estimates are currently $73.0 million in revenues and EPS of ($0.10). Stock is at a bottom. We plan to revise our estimates and price target after the earnings call. We maintain our Buy rating with a price target of $10. For 2003, our estimates are $349.0 million and ($0.21). Full Report - PDF
11.12.02
astsf: Initiating Coverage With A Buy Rating
ASE Test Ltd. is a leading test and assembly service provider in the Semiconductor Assembly and Test (SAT) sector with a 35% test market share exiting 2001, based on our estimates. The company, along with its parent company ASE Inc., leverages its test and packaging expertise, geographic presence, and foundry relationships to offer a one-stop shop for IDM and fabless semiconductor companies. We are initiating coverage of ASTSF with a Buy rating and $10 price target. Positives: 1) ASE is focused heavily on test services which we believe is going to be a high growth outsourced market; 2) The company’s footprint in Taiwan and proximity to foundries is a key growth driver; 3) Outsourcing trend of capital-intensive processes such as semiconductor test continues to gain momentum with IDMs; 4) ASE Test, through its ISE Labs subsidiary, has the advantage of locking in potential customers very early in the design stage for back-end test and assembly services. Negatives: 1) Aggressive capex spending in 2000 is still hindering the company’s ability to get back to profitability; 2) Excess capacity after the massive build-out of 2000 is still plaguing the semiconductor industry; 3) Impending price pressure in 2003 as a result of excess capacity. Full Report - PDF |
