AAC Technologies 2018

[winston]

not vested

C Suisse Cites AAC TECH: Limited Impact from Huawei Ban; to Meet 2Q Optics GM Target of 30%

AC TECH (02018.HK)'s management saw limited impact from the US side's Huawei ban, adding China's 5G buildout was on track, cited by Credit Suisse.

While the restrictions will mainly affect its precision mechanics business, AAC TECH's overall strategy will not be changed by the Huawei incident.

The firm was confident in meeting its 30% optics GM target for 2Q20, while modelling the 2H20 ASP at around RMB4-4.5.

C Suisse: AAC TECH (02018.HK) 1Q20 Results In-line with Guidance

Overall, AAC TECH was kept at Neutral, with a target of $47.3.

Source: AAStocks Financial News

[winston]

not vested

<Research Report>HSBC Global Research Hikes AAC TECH (02018.HK) TP to $56; Rated Buy

AAC TECH (02018.HK)'s 1Q20 results aligned with previous guidance, mentioned HSBC Global Research.

While optics revenue slipped 28% QoQ, the firm's gross margin stayed at 9% on seasonality, indicating improvement in both efficiency and yield.

The broker was upbeat on AAC TECH's optics unit and expected a recovery in its acoustic and haptics gross margins.

Overall, AAC TECH was kept at Buy, with target lifted from $51.2 to $56.

Source: AAStocks Financial News

[winston]

not vested

Brokers' Post-result Ratings, TPs, Views on AAC TECH (02018.HK) (Table)

Brokers│Ratings│TPs (HKD)
Goldman Sachs │Buy│66
CMSI│Buy│63
BofA Securities│Buy│64.5→60
Credit Suisse│Outperform│63.1→59.2
Nomura│Neutral→Buy│48→54.2
Daiwa│Outperform│51→52.5
Haitong International│Neutral│50→48
Guotai Junan International│Neutral│46.8
Citigroup│Neutral│46→45

Brokers│Views
Goldman Sachs│2Q result in line; fundamentals predicted to have reached the bottom in last quarter
CMSI│2Q result misses due to seasonality but optics business remains positive driver
BofA Securities│Quarterly result in line; iPhone orders to be key factor for 3Q result
Credit Suisse│2Q result in line; optimistic on recovery outlook over 2H
Nomura│2Q result misses but sees preliminary recovery signs; upgrades rating
Daiwa│Slowdown in near-term performance provides an optimal intervention point
Haitong International│2Q gross profit misses
Guotai Junan International│Negative factors of Vietnam factories to persist till 3Q; acoustics business estimated to be hampered in 2H
Citigroup│2Q GPM misses

AAC TECH Interim NP Leaps Almost 1.9x to RMB920M; Interim DPS HKD0.2

Source: AAStocks Financial News

[winston]

not vested

GPM pressure could persist in FY21-22F

2Q21 net profit rose 45% yoy, still 22%/12% below our/Bloomberg
consensus, due to weak GPM recovery in acoustic and optic segments.

We are less positive on GPM recovery in FY21F/22F due to the slow specupgrades in acoustic and aggressive pricing strategy in optics business.

We downgrade AAC from Add to Hold. Our TP is lowered to HK$46.94.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... BCE056A374

[winston]

not vested

AAC - SELL (Negative profit warning)

AAC Technologies’ profit warning indicates 3Q21 profit will decrease 51-61% YoY to Rmb166m-210m, about 65% below Bloomberg consensus.

The company attributed this to a lower FX gain versus 3Q20, the Covid-disrupted global supply chain, operation cost increases in China, and delays/cancellation of a Chinese customer’s phone models due to the integrated circuit (IC) shortage.

We expect supply disruption, material cost issues and the IC shortage to continue.

We downgrade from Outperform to SELL and cut our target price from HK$50.60 to HK$30 on lowered 2022 earnings estimates and a lower applied PE.

Source: CLSA

[winston]

not vested

AAC - SELL (Negative profit warning)

AAC Technologies’ profit warning indicates 3Q21 profit will decrease 51-61% YoY to Rmb166m-210m, about 65% below Bloomberg consensus.

The company attributed this to a lower FX gain versus 3Q20, the Covid-disrupted global supply chain, operation cost increases in China, and delays/cancellation of a Chinese customer’s phone models due to the integrated circuit (IC) shortage.

We expect supply disruption, material cost issues and the IC shortage to continue.

We downgrade from Outperform to SELL and cut our target price from HK$50.60 to HK$30 on lowered 2022 earnings estimates and a lower applied PE.

Source: CLSA

[winston]

<Research>BofAS Upgrades AAC TECH (02018.HK) to Neutral, Elevates TP to $33

BofA Securities released a research report upgrading AAC TECH (02018.HK) to Neutral from Underperform, on the back of a rebound in AAC TECH's results.

BofA Securities also raised its 2024-2026 earnings forecasts by 32-44% to reflect improved optical gross profit, and elevated its target price to $33 from $14.

BofA Securities believed that the stock's current valuation, which is close to its historical average after a rebound in June, has reflected recent positives, and that catalysts such as iPhone microphone high-wind upgrade and heat dissipation will be unlikely to drive further re-rating.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

not vested

AAC TECH(2018)

Analysis：

In 2023, AAC Technologies (02018) recorded a revenue of RMB20.42 billion, slightly down 1.0% YoY, with significant increases in precision mechanics and optics businesses revenues.

The gross profit margin was 16.9%, down 1.4 ppts YoY mainly due to the lackluster consumer electronics industry demand.

With the slow trend in specification upgrade in 1H 2023, net profit was RMB740 million, a decrease of 9.9% YoY.

However, the demand for mid-to-high end smartphones led a recovery trend in 2H 2023.

For 2H 2023, the company`s revenue was RMB11.20 billion, remaining flat YoY.

The gross profit margin was 19.2%, up 1.4 percentage points YoY and 5.1 ppts half-year-on-half-year, which indicated a recovery trend.

Net profit was RMB590 million, up 25.2% YoY.

Since the company will continue to maintain its leading market position in the smartphone industry, and explore more opportunities in mid-to-high-end models including emerging categories such as foldable devices, it is expected that the company would aim for better returns through continuous technological upgrades and operational efficiency improvements.

Strategy：
Buy-in Price: $31.80, Target Price: $34.58, Cut Loss Price: $29.30

Source: Phillips