Holtek Semiconductor Inc. (TPE: 6202) shareholders will have a reason to smile today. The analysts have significantly improved this year’s legal forecasts. The consensus figures for sales and earnings per share (EPS) rose, with the company’s business prospects being assessed much more optimistically. Investors were also fairly bullish on Holtek Semiconductor. The stock rose 16% over the past week to NT $ 82.40. Could this upgrade be enough to add even more inventory?
After this upgrade, the four analysts at Holtek Semiconductor forecast sales of NT $ 6.8 billion in 2021. This would be a significant sales improvement of 21% over the past 12 months. Earnings per share are expected to increase 18% to NT $ 5.40. Prior to this last update, analysts had forecast sales of NT $ 5.8 billion and earnings per share (EPS) of NT $ 4.47 for 2021. Lately, perception has definitely improved, with analysts increasing both their earnings and sales estimates significantly.
Check out our latest analysis for Holtek Semiconductor
With these upgrades, we’re not surprised to see analysts raised their price target by 12% to NT $ 84.75 per share. However, setting a single price target can be unwise because the consensus target is effectively the average of analyst price targets. As a result, some investors enjoy looking at the different estimates to see if there are different opinions about company valuation. There are a few different perceptions about Holtek Semiconductor, with the most bullish analyst rating it at NT $ 90.00 and the most bearish at NT $ 80.00 per share. This is a very narrow spread of estimates, either implying that Holtek Semiconductor is an easy-to-evaluate company or, more likely, the analysts rely heavily on some key assumptions.
Another way to look at these estimates is in the context of the bigger picture, e.g. B. How the forecasts stack up against past performance and whether the forecasts are more or less optimistic compared to other companies in the industry. The analysts definitely expect Holtek Semiconductor’s growth to accelerate. The forecast growth of 21% is favorable alongside the historical growth of 4.9% per year over the past five years. Compare this to other companies in the same industry whose sales are expected to grow 14% over the next year. It seems obvious that while the growth outlook is better than it has been in the recent past, analysts also expect Holtek Semiconductor to grow faster than the industry as a whole.
The bottom line
Most importantly, with this upgrade, analysts have revised their earnings per share estimates for this year in anticipation of an improvement in business conditions. Fortunately, analysts have updated their sales estimates too, and our data shows that sales are likely to outperform the broader market. With expectations significantly improving and a rising price target, it may be time to take another look at Holtek Semiconductor.
Better still, our automated discounted cash flow (DCF) calculation suggests that Holtek Semiconductor could be moderately undervalued. You can find more information about our evaluation method on our platform here.
Another way to find interesting companies that could hit a tipping point is to keep track of whether management is buying or selling using our free list of Growing Companies That Buy Insiders.
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