HIMX

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For an intro article, see here.

Their LCOS display tech is mostly for AR, so this is good news:

In spite of Google Glass' early stumbles, Alphabet's (GOOGL) Google apparently isn't giving up on augmented reality headsets. Given the company's unique technology strengths and its AR investments to date, that's probably the right call.  Engadget reports Google is "working on a dedicated headset that blurs the line between virtual reality and augmented reality." It adds the device doesn't need a phone or PC to power it, and that it will "offer features more in line with augmented reality systems than existing VR headsets" such as Facebook's Oculus Rift, HTC's Vive and Sony's PlayStation VR.

Google Reportedly Plans to Make an Augmented Reality Headset, and Here's Why It's Primed to Succeed - TheStreet

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Augmented Reality (AR) is really taking off:

But what if you could somehow play Pokémon Go while also paying attention to the world around you? That's exactly what Recon has attempted to do by porting the popular game over to the Jet, a pair of Android-based smart glasses the company released last year. The setup isn't perfect and it doesn't work completely just yet, but even what I've seen so far provides an exciting glimpse at the next wave of augmented reality.

Smart glasses make hands-free 'Pokémon Go' a reality

The companies that brought the world the PC boom have a plan to trigger a similar explosion in virtual-reality hardware. Intel and Microsoft announced Tuesday that they are working together to help computer manufacturers get into the business of making stand-alone VR headsets. Today that market essentially consists of just two products, Facebook’s Oculus Rift  and the competing Vive from phone company HTC.

Intel and Microsoft Are Teaming Up to Make Virtual Reality Ubiquitous

Following its acquisition of Magic Pony earlier this month, Twitter confirmed to me on Tuesday that it had hired Alessandro Sabatelli as its new Director of VR and AR. He will head up the Augmented Reality team within Twitter Cortex, the company's upstart machine-learning division. Sabatelli used to be a UI designer at Apple and is credited with helping create the iTunes visualizer. He has also worked with IXOMOXI, a startup focusing on developing contextual overlays for AR and VR systems.

Twitter confirms it's launching an AR division with new hire

In an interview with The Washington Post published Sunday, Cook said Apple is "doing a lot of things" with augmented reality (AR), the technology that puts digital images on top of the real world. Here's the full quote: "I think AR is extremely interesting and sort of a core technology. So, yes, it's something we're doing a lot of things on behind that curtain we talked about."

Tim Cook: Apple is working on augmented-reality projects - Business Insider

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Himax Technologies Inc. (HIMX) rallied above the 2006 post-IPO high at 9.45 in 2013 and rallied to an all-time high at 16.15 just six months later. The subsequent decline found support near 5.50 in the middle of 2014 and eased into a broad, rounded base that lasted into a March 2016 breakout. Trend momentum failed to develop after the buying spike, yielding six months of testing at new support.

This digestion process may be coming to an end, allowing the price to complete the large-scale breakout that started three years ago. It’s now testing the October 2014 high at 10.45, with a rally above that level opening the door to the 2016 high and .618 Fibonacci selloffretracement level at 12. This is a progressive pattern, with a subsequent breakout above that level needed to bring the March high and .618 retracement level into play. It’s best to manage this trade aggressively with a stop loss below the 50-day EMA, currently near 9.75.

3 Chip Stocks With Strong Buy Patterns (MSCC, HIMX) | Investopedia

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Himax Technologies (HIMX) is up 5% premarket after the company reiterated its Q3 and second half guidance this morning. The company reaffirmed its outlook in response to the recent decline in the stock. HIMX was testing resistance near the 11 level last week but then the stock fell ~20% on Monday after Nomura downgraded the stock to Neutral from Buy, citing the potential for a weak launch of Microsoft's (MSFT) HoloLens augmented reality device.

Himax makes display driver integrated circuits (IC) that go into large panel TVs, tablets and smartphones. Display drivers for large, medium and small sized panels accounted for 79% of revenue in its most recent quarter. However, many investors like Himax because of its LCOS and WLO product lines that are a key component for augmented and virtual reality (AR/VR) devices. HIMX has become a way to play AR/VR, even though it is still a tiny part of the overall business.

Himax did offer some commentary on that business to qualm fears this morning: Regards to the AR/VR business that many investors believe to offer the most exciting long term growth prospect, with little competition, the Company continues to work with 30+ customers for various AR devices using LCOS microdisplay and/or WLO with the list of customer still growing. The Company's design engagements cover leading companies in a wide variety of industries as well as niche players with innovative product ideas.

More of the Company's customers are expected to bring their AR products to the market next year. Having invested in related technologies for over 15 years, Himax is uniquely positioned as the provider of choice for microdisplay and related optics, both critical enablers to the AR device. The Company remains positive about its future prospects and technical feasibility of the AR/VR business.

This stock will remain volatile as the prospects for VR/AR play out in the coming months and years but the long term outlook appears favorable. Investors got burned in HIMX two years ago when the LCOS segment was a key supplier to the Google Glass, which inevitably flopped. HIMX trades at a reasonable or somewhat attractive valuation given its potential growth: 20x adjusted earnings and 1.8x sales -- 16x and 1.6x next year's estimates, respectively.

Himax [HIMX] reaffirms guidance after stock tumbles following downgrade at Nomura