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Wedbush Concerned About OmniVision Q1 Results- Lowers PT (OVTI)

In a note to investors Friday, Wedbush reiterated its “Neutral” rating on OmniVision Technologies (NASDAQ: OVTI) but lowred its price target from $18.00 to $16.00. In the note, Wedbush wrote:

“OVTI reported mixed FQ1 (Jul) results of a bottom line beat, but on lower revenue and provided FQ2 (Oct) outlook that missed expectations hurt by a slowdown in smartphone demand and intensifying competition. While FQ1 (Jul) pro forma EPS of $0.55 beat due to a tax benefit, revenue of $374MM (11% Q/Q) was below the Street ($0.43/$377MM) and our ($0.43/$380MM) estimates. FQ1 pro forma GM was flat at 17.7% versus FQ4 (Apr) as some manufacturing cost reductions were offset by an increase in provision for excess and obsolete inventories. FQ1 units shipped increased 11% Q/Q to 208MM up from 188MM in FQ4 largely in-line with our estimate of 208.6MM and DOI decreased 15 days Q/Q to 127 days from 142 days in FQ4.”

Company Profile:

OmniVision Technologies, Inc. engages in designing, developing, and marketing semiconductor image-sensor devices worldwide. It offers CameraChip image sensors, which are single-chip solutions that integrate various functions, such as image capture, image processing, color processing, signal conversion, and output of a processed image or video stream for use in various consumer and commercial mass-market applications; and CameraCube imaging devices that are image sensors with integrated wafer-level optics.

The company also supplies companion chips used to connect its image sensors to various interfaces, including the universal serial bus and other industry standard interfaces; and companion digital signal processors that perform compression in standardized still photo and digital video formats. In addition, it designs and develops software drivers for Linux, Mac OSX, and Microsoft Windows, as well as for embedded operating systems, such as Android, Blackberry OS, Symbian, Windows CE, Windows Embedded, and Windows Mobile.

The company sells its products directly to original equipment manufacturers and value added resellers, as well as indirectly through distributors. It serves mobile phone, notebook and Webcam, digital still camera, security and surveillance, entertainment, and the automotive and medical markets. OmniVision Technologies, Inc. was founded in 1995 and is headquartered in Santa Clara, California.

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[stock-tools exchange="NASDAQ" symbol="OVTI" image_height="230" image_width="350"]

Disclosure: At the time of this writing, the author had no position in the company mentioned.

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