InvenSense Is A Solid Investment, With Or Without Apple
Seeking Alpha - Apr. 9, 2014 6:52 AM ET
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Summary
InvenSense has a solid and diversified client base, so it is not dependent on just Apple for growth.
InvenSense is focusing on product development, and its new sensors are gaining traction in smartphones, tablets, and gaming.InvenSense is cheaper than the industry average on a forward P/E basis, and its earnings are expected to grow at a fast pace, making it a good buy.
Chipmaker InvenSense ( INVN) is a leading provider of motion tracking sensor system on chips (SoCs) and sound solutions for consumer electronic devices. The company has been in the news of late, with rumors suggesting that Apple ( AAPL) could be using InvenSense's sensors in the next iPhone. However, I think it would be a better idea to see if InvenSense is a solid buy without Apple, as basing investment decisions on rumors is not a good idea.
Solid without Apple
InvenSense has seen solid growth at its mobile customers, and is gaining traction in emerging markets, such as China. InvenSense witnessed tremendous growth in its smartphones and tablets segment last quarter, with 83% of the total revenue coming from this business. The company was successful in gaining market share in various flagship products, such as the Samsung Galaxy Note 3, Google's ( GOOG, GOOGL) Nexus 5, and Amazon's ( AMZN) Kindle Fire that are being powered by InvenSense's 6-axis motion tracking devices. Now, InvenSense's 2-axis OIS (optical image stabilization) Gyro platform for OIS-enabled smartphones, such as LG's G2 and Nexus 5 has also gained steam.
Products gaining traction
Most of InvenSense's customers are adopting its OIS system to improve camera quality for their products. Therefore, InvenSense expects strong traction from its motion tracking products going forward.
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InvenSense Price Target Increased to $27.00 by Analysts at Pacific Crest
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22.41
+1.37 (6.51%)
After Hours: 22.62 +0.21 (0.94%)
Apr 9, 7:38PM EDT
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Currency in USD
| Range | 21.19 - 22.43 | | 52 week | 9.09 - 24.34 | | Open | 21.36 | | Vol / Avg. | 2.31M/2.81M | | Mkt cap | 1.97B | | P/E | 79.49 |
| Div/yield | - | | EPS | 0.28 | | Shares | 87.81M | | Beta | - | | Inst. own | 99%
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