Synaptics, Inc. (NASDAQ:SYNA)

New CEO.

I see this company not just as the TouchPad company, but as a human interface company, and I don't think they are done tinkering with the human interface. Thus, I think there is room for growth.

Innovation = Growth

... and these guys have proven that they are good at it.

Touch screens are the future (I carry more screens around with me than anyone justifiable should). Synaptics uses the best technology that delivers better performance. But tech aside, I see the company building out its ecosystem through PR and marketing efforts. Building the brand will preserve SYNAs stance as a leader, and that's what will drive the stock higher long term.

Innovative products in the best sector currently.

The pulse of technology

short squeeze ahoy

Well, SYNA just can't get any love. Consistently beat earnings estimates, grow earnings YOY, but no love from the market. I own in RL from $23.28, so I am doing OK, but not as well as I would like given what the market has done since I bought and the repeated earning beats (6 out of 7 since I bought). Oh well, I am going to continue to hold here.

-Synaptics, Incorporated (Public, NASDAQ:SYNA)
Analysis 5G. (4.9.2010.)
Stability: ***** (Ultra-stable)
Auditor: KPMG

NOTE: I use my own five star stability rating system, because I don't trust world's rating agencies for my investments. A five star rating means that company is Ultra-stable in my eye, and I would buy a corporate bond from this company at par.

recommended by Michael Robinson from American Wealth Underground, May, 2010.

3-year growth per share:
rev.growth = 30% y/y for last 3 years. Earn.growth = 40% y/y, FCF grew at 80% y/y !!! (per share)
7-year growth per share:
rev.growth = 20% y/y for last 7 years. Earn.growth = 25% y/y, FCF grew at 32% y/y !!! (per share)

P/E=17.5
P/FCF=8.7
P/Sales=1.8
P/B=3.2

Based on P/E, the company's stock *looks* expensive, but this is not so, due to high FCF.
The company is constantly improving upon it's operations, yet the stock price isn't moving anywhere.

The stock is priced above *value* criteria defined by Ben Graham, but I can make a speculative move.
The P/B ratio is a bit high.

If the company's shares fall by 40-50%, I will consider increasing stake.

Good points:
1. Management: buys back shares/stock repurchases
2. Strong competitive moats.
3. China-proof. (they do only R&D, while manufacturing is outsourced.)
4. FCF-on-Assets Ratio (FCFoA) is 25% ! and FCFoE = 40% !
Those parameters are beaten only by few companies such as U.S. "ITT Education" and
Israeli "Roshtov".
5. strong balance sheet
6. good growth

Bad points:
1. Stock Not cheap.
This stock price at $26/share fails Ben Graham's definition of value.

My opinion:
The tablet market is promising. It could be an interesting long-shot speculation.
Stock is not cheap, but reasonably priced.
However this price can be dustified by it's free cash flow.
Basically the company understates own earnings. But FCF shows the truth here.

Verdict: Due to stock price, it does not qualify as an investment, but could be bought in small quantity on speculative basis at $30/share.

3rd party Analysis: Touchscreen chipmakers tap tablet boom
http://www.reuters.com/article/idUSTRE6884HQ20100909

The author, Michael Robinson, thinks it is cheap, and from growth investor standpoint, it really is, but from a value investor's standpoint, such as Graham, it simply isn't.
The author compares this to industrial average, which is absolutely wrong, as the dot.com crash proves. It must be compared to investor's own logic, not to industry average.

-MashkiaTsair, al4321@gmail.com

BBY Focus on touch screen gadgets .

They make parts for iPhones, and have decent growth opportunities.

touchscreens

No debt, solid PM/OM....I like it. The big bad world doesn't love you Synaptics, but I wuv you.

Touchpad and touchscreen demand will only increase and quickly. Company has good fundementals and is undervalued right now.

Leading touchscreen and touchpad maker.

Touchscreen smartphones will continue to gain market share throughout 2010 and 2011, and Synaptics provides the technology for most of the big name phones companies, i.e. RIM, LG, Nokia. Add on the Apple Tablet due out 1st quarter of 2010, which uses Synaptics technology, and there is extreme growth potential over the next few years. With a relatively low P/E, low Price/Cash Flow, and high Short Interest, I predict this stock to soar past its resistance level of 40.46 by 2nd Quarter 2010.

Forward PE only 12. PEG 0.7. Strong balance sheet 192M cash, 64M debt, great industry growth. Down from 40.

Touch screen demand is surging and Synaptics' new technology will lead the way. I look for this stock to grow over the next few years.

Touchpads, touchpads, touchpads!

Good ratios