ams-OSRAM Hammered On Weak Near-Term Performance And Longer-Term Competitive Doubts

Writing about ams-OSRAM (OTCPK:AMSSY) in March, I was concerned about the risk that weaker near-term results would overshadow the company’s efforts to reposition its technology toward higher-growth long-term opportunities. I underestimated just how weak that near-term performance could be, though, and it seems that the Street is unwilling to give this company any real benefit of the doubt at this point – a situation that I argue the management team has earned.

These shares have fallen another 45% since my last article, dramatically underperforming the SOX over that time. Although these shares don’t look expensive at this point, the impact of losing 3D sensing business at Apple (AAPL) and a lack of traction thus far in other growth projects makes for a challenging buy call. I do see opportunities for ams to be a stronger company (and stock) in the future, and I like the idea of buying in at a price where sentiment is ugly, but investors considering this name need both high risk appetite and patience.

 

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ams-OSRAM Hammered On Weak Near-Term Performance And Longer-Term Competitive Doubts