Managing Director, Zero One, Zero One

Vincent Fernando, CFA

20 years of experience researching capital markets in Asia and the USA.

Managing Director, Zero One

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Zero One

Founded in 2015, Zero One produces independent investment research and provides corporate finance advisory services with a focus on both listed and private technology companies. Founder Vincent Fernando has over 20 years of experience in US and Asia capital markets.

Independent Investment Research

Equity Bottom-Up

Novatek Microelectronics Corp / Equity Bottom-Up

<ul>
<li>Novatek reported 1Q24 results yesterday after the Taiwan close; gross margin came in ahead of guidance and revenue was in-line.</li>
<li>Nevertheless, the company's forward color regarding end market display applications demand in 2Q24 and 2024 was relatively muted.</li>
<li>Given the stock is at all-time highs and up about 25% since early February, we see the stock at risk of selling in the near-term. We rate Novatek as Underperform.</li>
</ul>


Novatek reported 1Q24 results yesterday after the Taiwan close; gross margin came in ahead of guidance and revenue was in-line.
Nevertheless, the company's forward color regarding end market display applications demand in 2Q24 and 2024 was relatively muted.
Given the stock is at all-time highs and up about 25% since early February, we see the stock at risk of selling in the near-term. We rate Novatek as Underperform.


Novatek Seeing Soft Consumer Electronics Demand; Muted Forward Guidance; Shares Appear at Risk