Oppenheimer on Nov 13, 2012
OUTPERFORM
12-18 mo. Price Target $16.00
NQ - NYSE $6.47
NQ’s reported 3Q12 sales and non-GAAP EPADS of $25.8M/$0.16, above consensus
of $24.5M/$0.15 and relative to our estimates of $24.3M/$0.16. Sales grew 127%
y/y, driven by contributions from NationSky and robust growth in users and ARPU.
Margins contracted further due to the lower margin profile of NationSky and higher
opex as a % of revenues. Management guided to revenue of $28.5-29.5M in 4Q12 and
$150-155M in 2013, both above consensus estimates. We’re tweaking our estimates,
largely to reflect modestly higher growth and lower margin assumptions. NQ also
announced the acquisition of Feiliu. We believe investors will likely react positively to
NQ’s 3Q results and guidance and progress of its mobile retail strategy.
Full report attached in PDF
