Synaptics (SYNA): Best Digital Media Idea for 2016 - Cowen
Get Alerts SYNA Hot Sheet
Rating Summary:
14 Buy, 7 Hold, 1 Sell
Rating Trend: Up
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 11
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Cowen analyst, Robert Stone, highlighted Synaptics (NASDAQ: SYNA) as his best idea in Digital Media for 2016. According to Stone, the stock has numerous catalysts and is cheap at more than a 20% discount to the 3-year mean forward P/E.
Multiple OEMs should launch smartphones with ClearForce 3D touch displays in H1:CY16. We also expect new fingerprint sensor designs, from a broader range of mid-range Samsung smartphones supporting Samsung Pay, as well as other new OEMs, plus the first fingerprint sensor under glass. TDDI wins should also proliferate. We look for news around CES and Mobile World Congress.
Strategic expansion into new segments and applications such as automotive and multi-modal biometrics should drive out-year growth above Street. At 21% below the 3-year mean year forward P/E, the shares are quite undervalued.
SYNA is currently trading at 10.7x consensus year-forward EPS, 21% below the 3-year mean of 13.6x (range 9.0-19.8x). The $115 PT equates to 14.1x our F17E EPS of $8.15 (+6.1% vs. St). This means that SYNA is undervalued relative to consensus but more importantly, F17-18E Street consensus EPS expectations of +10% and +5%, respectively, have room to go higher. SYNA targets 15%+ sales growth as it enters new segments and applications.
For an analyst ratings summary and ratings history on Synaptics click here. For more ratings news on Synaptics click here.
Shares of Synaptics closed at $78.66 yesterday.
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