Himax Technologies (HIMX) is one of the many stocks in the semiconductor sector that skyrocketed amid high demand this past year, and delivered exceptional returns. While the prolonged supply-demand imbalance continues to pose challenges, Himax’s favorable product mix and continued momentum in its Notebook and Automotive segments provide a solid platform for growth.
The share price of this semiconductor company has jumped over 211% in one year. Moreover, it has rallied by approximately 84% in 2021. (See Himax Technologies stock chart on TipRanks)
Thanks to strong performance across all its major business units, Himax Technologies recently delivered better-than-expected Q2 financial numbers. Revenues rose 18.2% to $365.3 million from Q2 2020, surpassing estimates of $362 million. Furthermore, its adjusted earnings per share of $0.624 exceeded analysts’ expectations of $0.574, reflecting higher revenues and improved operating margins.
While Himax’s Q2 performance is encouraging, the question remains: Is the rally in its stock sustainable?
Credit Suisse analyst Jerry Su thinks so, forecasting a price target of $23.
Notably, Himax increased gross margin of 47.5% in Q2, considerably higher than the 40.2% reported in Q1, and 21% in the prior-year quarter. This trend looks likely to continue, with gross margin expected to land between 50.5% and 52% in Q3.
On TipRanks, Himax Technologies stock has a Moderate Buy consensus rating, based on one Buy. The average Himax Technologies price target of $23 implies 72% upside potential from current levels.
Disclosure: Amit Singh held no position in any of the stocks mentioned in this article at the time of publication.
Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.
