Switches, sensors, components and controllers are the
guts of electronic devices and we largely take them for granted. It is
nevertheless a sizable business opportunity for Japan's Alps Electric (OTCPK:APELY)
and the company has generated high single-digit growth in recent years
by supplying electronic components to the auto OEM and consumer
electronics markets (smartphones in particular).
While providing camera actuators for smartphone companies like Apple (NASDAQ:AAPL)
has been a good business for Alps, it has also been volatile and
management at Alps believes that it will be harder and harder for phone
developers to stand out in the market. With that, Alps is looking to new
products in autos and consumer products to drive the next leg of
revenue growth and margin leverage.
The next few
quarters should see Alps report stronger financials, and that can
re-ignite investor enthusiasm for these shares. While I believe the
shares are somewhat undervalued today, I'd note that a low single-digit
revenue growth rate may end up being conservative if the company's
efforts in advanced auto electronics and haptics pay off.
Continue here:
Alps Electric Looks To Drive Back Up The Mountain
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