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Technology Stocks : Cohu, Inc. (COHU) -- Ignore unavailable to you. Want to Upgrade?

To: robert b furman who wrote (6345)

4/28/2017 11:59:52 AM

From: robert b furman

Read Replies (1) | Respond to of 7827

Cohu's earnings were released last night:

They beat on revenue 81.1 million vs guided 76

They beat on margins OVER 40%

They were estimated to make 24 cents non gaap -They beat with 39 non-gaap and delivered 24 gaap.

They guided 86 million and a bit of a drop in margins - due to product mix .

So they popped up a 1.60 before earnings - Now everyone sees why I hate up into earnings with Cohu.

So why is it down $2.72 as I type?

"The story is playing out in the options market.

I was already to type a note as to how badly I blew the call in a past post written earlier this week - it pointed out that the May expiration is huge August is huge also - but back to May - here's my past post:

What will be exciting is May - there are a slug of options out there:

1615 calls ranging from 12.50 to 20.00 - 725 of them at 17.50. Once again making the calls a battle ground at 17.50 - creating a need for inventory?

Only 293 puts out there 180 of them at 12.50. that shouldn't take any inventory but there are 173 at 17.50.

So I see a battle at the$ 17.50 price range for the next month.

The market maker will want to buy below 17.50 and sell them with an advance, to the call owners who paid a premium plus 17.50 at expiration.

Since May is so big in open interest it must have the MM's attention.

I wouldn't be surprised to see a little post option expiration dip below 17.50 to shake out the new low hanging fruit."

So here is the larceny of big money at play.

The Market maker was facing a huge sale of inventory when all of the 15.00, 17.50, and 20.00 calls delivered stock had the price stayed in the 21.00's

This morning at the open literally 1/3 of the 15.00 and 17.50's were sold 260 contracts of the 17.50's and and 150 contracts of the 15.00's.

So the 20' have expired worthless (the largest open interest at 775 contracts - what a nice paycheck for the MM.

The 17.50's now have open interest of 452

the 15's have 326 open interest

the 12.50's have 176 open interest.

So the 20's do not cost any inventory.

If the market maker can push the price down below 17.50 he'll buy up stock and sell it as those calls deliver stock and he makes a mark up.

The 12.50 will deliver stock also.

If price closes above 17.50 - he'll need 50,200 shares on May 19th.

That's very small volume vs what has been trading lately.

Note how both months that have large open interest are right after a quarterly earnings occurs.

Also guidance was good and these guys are serial sandbaggers.

Jeffrey Jones has modeled 90 million for several years and this webcast he bumped up the margin associated with that level of revenue.

It looks like the Kita acquisition is paying off nicely. It raises the possibility that consumable could work towards 50% of revenue.

Cohu will print money at 100 million revenue - if the Delta Lin X (waferlevel packaging) gets going we'll be there in 2018.

Note to File last night Intel guided capex up to 12 million in 2018 Intc is one of two companies over 10% of revenue NXP is the other.

If you go back to monthly charts - look at Ter and note how it reached the upper 21.00 and then retraced back to 14.75.

If Cohu does a similar corrective wave - selling in the money puts at $15.00 will be a huge paycheck.

Buy the dip - but let the MM get his pound of pain first.

Get ready to rumble in August!

Bob

ess Release

Cohu Reports First Quarter 2017 Operating Results

Q1 sales up 15% sequentially to $81.1 million with GAAP gross margin of approx. 40%Q1 GAAP income per share of $0.24; non-GAAP adjusted EPS of $0.35Record orders with continued momentum in automotive, mobility and IoT marketsPOWAY, Calif.--(BUSINESS WIRE)--Apr. 27, 2017-- Cohu, Inc. (NASDAQ:COHU) today reported fiscal 2017 first quarter net sales of $81.1 million and GAAP income of $6.8 million or $0.24 per share. The Company also reported non-GAAP results, with first quarter 2017 income of $9.9 million or $0.35 per share.


GAAP Results (1)
(in millions, except per share amounts)		Q1 FY 2017	Q4 FY 2016	Q1 FY 2016 (2)

	Net sales	$ 81.1	$ 70.7	$ 65.8

	Income (loss)	$ 6.8	$ 2.3	$ (1.7)
	Income (loss) per share	$ 0.24	$ 0.08	$ (0.06)



Non-GAAP Results (1)
(in millions, except per share amounts)		Q1 FY 2017	Q4 FY 2016	Q1 FY 2016 (2) (3)

	Income	$ 9.9	$ 6.6	$ 1.6
	Income per share	$ 0.35	$ 0.24	$ 0.06

	(1)		All amounts presented are from continuing operations.

	(2)		In the fourth quarter of 2016 the Company early adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, (ASU 2016-09). As a result of the adoption of ASU 2016-09 certain amounts in the quarter ended March 26, 2016 have been restated as if the new accounting guidance was adopted starting with the first day of our 2016 fiscal year. The impact of these restatements was not significant.

	(3)		Non-GAAP results for the first quarter of 2016 were revised in the current period to exclude the impact of other acquisition costs incurred in connection with the acquisition of Kita Manufacturing Ltd. (“Kita”) on January 4, 2017.

Total cash and investments at the end of the first quarter were $106.2 million and decreased from the year ended December 31, 2016 primarily as a result of the purchase of Kita.

Luis Müller, President and Chief Executive Officer of Cohu stated, “We had an excellent quarter with improved financial results and record system shipments from our Malaysia operation. Semi equipment orders were at an all-time high with strong demand for turret and pick-and-place handlers, as well as multiple contactor design-wins. There is also robust customer demand for our just acquired Kita spring probe product lines.”

Müller concluded, “End-market dynamics and customer forecasts are expected to result in another quarter of book-to-bill above one. We continue to capture new device test and inspection applications for our handlers and benefit from increasing semiconductor package integration.”

Cohu expects second quarter 2017 sales to be approximately $86 million. Cohu's Board of Directors approved a quarterly cash dividend of $0.06 per share payable on July 28, 2017 to shareholders of record on June 16, 2017. Cohu has paid consecutive quarterly cash dividends since 1977.

To: robert b furman who wrote (6345)	4/28/2017 12:31:09 PM
From: EACarl	Read Replies (1) \| Respond to of 7827

Buy the rumor, sell the news? Earnings beat and forward outlook great. Yes, next quarter revenue was projected at $86 million vs. $88 million analysts estimates, but they typically under promise and over deliver, so not a big deal. Plus, based on the numbers they gave for gross margin and operating expenses etc, earnings should be a BEAT of analysts estimates. As far as the dividend goes, I'm at a loss as to why they would not give it at least a slight bump. Yes, I'm doing well with the shares I have. Not selling on today's reaction.