In a report released today, Tristan Gerra from Robert W. Baird maintained a Buy rating on Himax Technologies (HIMX – Research Report), with a price target of $15.00.
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Tristan Gerra has given his Buy rating due to a combination of factors. Himax Technologies is poised for substantial growth with its new initiatives in Co-Packaged Optics (CPO) and Augmented Reality (AR), each expected to generate significant revenue streams. The company anticipates that CPO will initially be integrated into switches and later into advanced processing units, potentially contributing hundreds of millions in annual sales. Additionally, Himax is well-positioned in the AR market with its advanced technologies, including LCos microdisplays and WiseEye AI solutions, which are generating renewed interest.
The automotive sector remains a major revenue driver for Himax, representing nearly half of its 2024 revenue and growing at a rate of 20% year-over-year. The company holds a dominant position in the automotive TDDI market, with a market share exceeding 50% and numerous design-in projects underway. Himax’s strategic advantage in the OLED automotive space and its consistent revenue growth, despite seasonal fluctuations, further support Gerra’s positive outlook. The company’s recent quarterly performance, with increasing revenue and stable gross margins, along with guidance exceeding market expectations, reaffirms its potential for continued success.