Edison Issues ADR Outlook on Thin Film Electronics
LONDON, April 13, 2016 /PRNewswire/ --
Thinfilm (THIN) is the global leader in printed electronics, which is a low cost and highly scalable method of creating smart labels for the Internet of Things (IoT). In recent months the company has announced a slew of pilot orders and partnerships with leading brands, consultants and packaging companies, including global drinks giant Diageo, labels leader Xerox and a major global FMCG producer. On a six- to nine-month horizon, we expect Thinfilm to translate this into strong growth in order volumes leading to a likely uptick in earnings forecasts and stock valuations.
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Our DCF value for Thinfilm has increased from $7.75 to $9.06 per ADR. This follows revisions to our model to reflect our view of improved revenue prospects, particularly for NFC OpenSense, and our expectation that the company will move straight from the recent de-bottlenecking of its sheet-based line to the installation of a 1bn+ capacity R2R line. These were partly offset by dilution from the Woodford share issue. We see key potential triggers for 2016 as stronger than expected order inflows and the potential for a move straight to R2R production with positive impact on capex and operating margin forecasts.
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Anna Bossong
Edison Investment Research
+44-(0)20-3077-5737
Katherine Thompson
Edison Investment Research
+44-(0)20-3077-5730 [email protected]
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SOURCE Edison Investment Research
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