Synaptics, Inc. (NASDAQ:SYNA)

CAPS Rating: 4 out of 5

The Company is a developer and supplier of custom-designed user interface solutions that enable people to interact more easily and intuitively with mobile computing, entertainment and other electronic devices.

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Member Avatar TMFInnovator (49.53) Submitted: 7/30/2014 3:49:15 PM : Outperform Start Price: $76.05 SYNA Score: +2.35

Synaptics is the leading provider of human interface solutions for electronic devices. It's a swing for the fences, but I definitely think it has the potential to be a game-changer.

Synaptics's core business is in laptop touchpads and Smartphone touchscreens. The laptop business is slowing dying, but mobile is growing out of control. The company expects 40% quarter-over-quarter revenue growth (!) as it continues to supply the sensors and chips to OEM customers like Samsung, HTC, and Nokia. Mobile as a percentage of revenue has increased from 49% in 2012 to 64% in 2013.

But the really interesting part (to me, at least) is that Synaptics now has the dominant technology and nearly 100% market share of the fingerprint identification market after buying Validity in November. There is an industry consortium called the FIDO Alliance that is pushing for fingerprint recognition to be a standard for both security and online transactions. FIDO has some big names represented (Google, PayPal, Mastercard, Bank of America), so there's some momentum behind this as a potential platform shift. If successful, that would mean no more having to remember account logins and multiple passwords to facilitate transactions online. It could all just happen with the touch of your fingerprint.

SYNA spends 20% of revenue on R&D (!!!) and is no doubt the innovator in the space. If the future looks different from the past and fingerprint ID really takes off, Synaptics could have a market cap that is several multiples larger than it is today.

Definitely a risky pick, but it passes my Rule Breakers smell-test. Outperform.

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Member Avatar pagliacci100 (62.43) Submitted: 7/28/2014 3:10:58 PM : Outperform Start Price: $75.42 SYNA Score: +3.90

buying back @72+? trailing stop xecuted - resetting trail to 25%..........3Q rev25%^ over last yr.40% rev growth fwd toQ4...human- machine interaction 'pure play' broadest product spectrum in sector, 500 patents&growingstrong, strong leadership too. smart device 'population' projected to grow 600% worldwide over nxt 6yrs.....now seems right, good entry here....

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Member Avatar jonnythekay (22.48) Submitted: 7/14/2014 3:45:03 PM : Outperform Start Price: $88.58 SYNA Score: -12.13

bought this along with GLW and IMMR

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Member Avatar tiobueno (99.47) Submitted: 7/14/2014 10:04:25 AM : Underperform Start Price: $88.58 SYNA Score: +12.06

Hedge

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Member Avatar Bingwang12 (< 20) Submitted: 6/13/2014 2:57:09 PM : Outperform Start Price: $84.85 SYNA Score: -10.01

The recent purchase of Renesas should help Synaptics establish its market position better. With Apple giving up on buying Renesas it could mean Apple is ready to add on Synaptics as a supplier again.

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Member Avatar Mendy67411 (< 20) Submitted: 5/12/2014 10:11:42 PM : Outperform Start Price: $60.62 SYNA Score: +25.11

Well positioned growth

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Member Avatar buynholdisdead (23.58) Submitted: 3/5/2014 5:33:41 PM : Outperform Start Price: $64.96 SYNA Score: +15.35

Syna creates touch display for tablets, phones, and pc's While their pc sales have been coming down their tablet and phone sales have been shooting up. Time to ride the wave of phones and Tablets.

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Member Avatar dstwhit (80.98) Submitted: 2/6/2014 12:03:42 PM : Outperform Start Price: $56.45 SYNA Score: +27.01

high growth, low p/e; see saul insights; good b/s; experienced leadership; big role in future of innovation

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Member Avatar grankh (77.45) Submitted: 12/13/2013 1:21:57 PM : Outperform Start Price: $49.78 SYNA Score: +48.23

This is another stock that is in the process of being purchased by my Investment Club, so will become a real-life holding of mine this afternoon.

Sales have grown at an average annual compound rate of 12% since 2009. EPS has grown at an average annual compound rate of 22% during that time. The pretax profit margin has grown each of the past 3 years. The earned-on-equity has fluctuated over the past few years, but was about 18% last year. The debt-to-equity has decreased over each of the past 3 years, and is a very low 0.5%, (which is great in my book). The current P/E is below its average of the past 4 years, so is cheap on that metric. The PEG ratio is about 0.62, which is also cheap. The stock does NOT pay a dividend, which is sad.

I believe this stock could appreciate as much as 30% annually if it can keep up its stellar performance, which I think is great. Here's hoping it can continue its great run for me and my club.

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Member Avatar paek813 (99.61) Submitted: 6/26/2013 9:04:36 PM : Outperform Start Price: $39.12 SYNA Score: +77.52

From the S&P Capital IQ:

SYNA expects to report net revenue in the range of $227M-$230M for Q4, an increase at the mid-point of about 66% y/y and 40% sequentially. Capital IQ consensus forecast is $198.62M. Cites higher than expected revenue from mobile products, reflecting strong demand from a broad range of leading-edge designs across multiple mobile customers. Needham raises estimates, maintains buy.
______________________________________

From the Fool:

Why Synaptics Shares Surged:

What:
Shares of Synaptics climbed 11% today after the touch-screen technologist raised its outlook for the current quarter.

So what:
The stock has slumped over the past month on concerns over slowing growth, but today's upbeat guidance reignites optimism on Wall Street over the mobile trends working in Synaptics' favor. The company also expects gross margins to be higher than previously expected, suggesting that its competitive position is strengthening as well.

Now what:
Management now sees fourth-quarter revenue of $227 million to $230 million, up from a prior view of $190 million to $205 million and also well ahead of Wall Street's estimate of $198.6 million.

"The Company's updated outlook is being driven by higher than expected revenue from mobile products, reflecting strong demand from a broad range of leading-edge designs across multiple mobile customers," Synapics wrote in a statement.

With the stock still well off its 52-week heights and currently trading at a forward P/E of 12, there might even be some room left to benefit from that operating momentum.

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Member Avatar TMFHumbleServant (97.92) Submitted: 5/30/2013 12:34:40 PM : Outperform Start Price: $41.33 SYNA Score: +70.44

The touch-screen maker will continue to innovate and be a part of the burgeoning wearable technology trend.

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Member Avatar ScalaAnalyst (20.94) Submitted: 5/29/2013 5:12:52 PM : Outperform Start Price: $41.96 SYNA Score: +67.26

This company design custom human interface solutions to interact with mobile computing, communications and entertainment in China, Japan, Taiwan, Kora, and US. They market: ForcePad, NavPoint, ClearPay, FlaxPad, ClearButtons, Thintouch and TouchButtons. I'm guessing these connect to mobile smartphones and other electronics via their touch screens. I understand they have now added a hover feature which allows to to see certain information when you hover your finger over the screen as opposed to actually touching the screen. This feature is a little tricky to use, but might pay off in the future. This company is based in Santa Clara, CA.

On the financial side:

Insiders 6% well, at least someone there believes in the company.
PEG is a little high at 1.28 and they have a trailing PE of 21.89. Their current EPS is 1.93.
Well, their sales growth is -8.40% and their income Growth = -15.10%
Debt/Equity Ratio is 0.01, which is great. They can concentrate on growing the business, not paying down debt.
They do not pay out a dividend, so hopefully this is a growth company.

On Earnings:
Analysis who follow SYNA believe the company will do well in the next two years. They have raised the earnings from about 0.35/sh to over double to 0.76/sh. That is some estimating. I guess they believe that they will do some outstanding sales and report some great earnings in the next few quarters. In an industry that makes only about 15% growth they have grown about 18.20% and this year alone they should grow at 24.40%. That would be nice if they can meet these expectations.

On Income Statement:
The total Revenue has stagnated holding over 500 million in 2012, 2011 and 2010. So, their gross profit and Net Income shows pretty much level movement these last few years as well. I'm not seeing much historical growth here; perhaps the analysts have some future information that is not reported at this time.

On the Balance Sheet:
Assets have been growing at only about 10% per year if that much. I guess it is a good thing that they haven't started falling with negative earnings. This would appear to be a slow grower.

On Cash Flow:
At least they are able to get a handle on their cash flow. It seems to be increasing slightly more than their sales and income. So, at least they are trying to keep operational expenses under control.

So, investing in this stock might be viewed as a risk play. I'm not convinced that they will provide some strong gains based on their history. But I am intrigued by what the analysts are showing. I'm sure their technology is used in all touch-screen devices, so they are not dependent on any one company. So they have their business established throughout the touch-screen business. So, I believe we will be seeing more of this technology appearing in our everyday lives, and they will be there providing the technology to take us to the future.

I don't have any insider information, but it appears the analysts know something I am missing. I know the communications industry is improving and nearly everyone I know has some kind of hand held device. Perhaps one should take a look at where else their technology can be applied so one can get a better understanding as to how unique these products are.

If I buy this company, I would offer at 38/sh, rethink it if it falls to 35/sh and sell at 55/sh.

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Member Avatar scrubs62074 (81.17) Submitted: 1/25/2013 11:41:11 AM : Outperform Start Price: $37.99 SYNA Score: +74.14

Breakout on high volume on 01/25/13

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Member Avatar ROEoutshinesGOLD (99.21) Submitted: 10/25/2012 8:14:57 PM : Outperform Start Price: $24.57 SYNA Score: +179.76

blogs.barrons.com/techtraderdaily/2012/10/25/earnings/

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Member Avatar surabayajhonny (53.00) Submitted: 8/26/2012 7:37:12 PM : Outperform Start Price: $30.49 SYNA Score: +117.86

New touch tech should lead to design wins in ultrabooks and mobile devices.

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Member Avatar VolvoSmile (< 20) Submitted: 10/1/2011 1:44:32 AM : Underperform Start Price: $23.67 SYNA Score: -155.61

New CEO.

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Member Avatar there4im (59.62) Submitted: 7/22/2011 6:52:33 PM : Outperform Start Price: $24.60 SYNA Score: +170.84

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.

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Member Avatar egabriellemoranU (62.43) Submitted: 7/7/2011 4:57:23 PM : Outperform Start Price: $25.23 SYNA Score: +163.41

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.

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Member Avatar bodiebear (84.56) Submitted: 2/8/2011 12:31:34 PM : Outperform Start Price: $29.23 SYNA Score: +118.88

The pulse of technology

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Member Avatar GrowthnValue (< 20) Submitted: 1/21/2011 10:02:54 AM : Outperform Start Price: $27.25 SYNA Score: +109.51

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.

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