[ET Net News Agency, 1 November 2019] Jefferies Research lowered its target price for
ASM Pacific Technology (00522) to HK$98 from HK$100 and maintained its "hold" rating.
The research house said ASM's 3Q missed on revenue and net profit consensus by 9% and
53% due to delayed recognition of NEXX tools, lower gross margin, and higher tax rate.
Management guided (1) booking down double-digit q-q due to seasonality, (2) gross margin
slightly down due to SMT (surface mount technology).
Jefferies thinks the disappointing SMT 4Q booking reflected 5G base station demand
slowdown due to design change, but it expects demand to rebound in 1Q 2020 driven by 5G
rollout. Jefferies trimmed its FY2020/21 revenue estimates by 3.9%/5.9% and net profit
forecasts by 6.2%/3.6%, respectively. (KL)