George Soros (Trades, Portfolio) has purchased 5.11% of a new company, Spansion Inc. (CODE), according to GuruFocus Real Time Picks. The April 25 transaction consisted of 3,066,666 shares, which had a closing price of $17.76 each that day. Spanion’s share price has increased 4.4% since 2010, to almost a two-year high of around $17.56 on Tuesday.
Spansion is a Flash memory embedded systems solutions company, whose components run in routers and electronics. The company went bankrupt in 2009 due to declining chip prices and oversupply in the chip market fueled by lack of demand. It reorganized in May 2010, with a new model to foster growth in key segments, namely automotive, consumer and gaming, communications and industrial.
A day prior to Soros’ investment, Spansion introduced six new automotive devices to its flash memory portfolio, developed to meet the higher temperature ranges and quality requirements of the auto industry. Such components are in increasing demand as the industry expands its electronic application offerings, such as advanced driver assistance systems, instrument clusters, infotainment and data logging systems.
In the fourth quarter, Spansion reported a 40% year-over-year net sales increase to $313.7 million, boosted by the addition of its two new businesses, Microcontroller and Analog/Mixed Signal, acquired from Fujitsu. Is net loss was $23.7 million, compared to net earnings of $6.9 million in fourth quarter 2012. The company also reported a gross margin of 29.7%, down slightly from 32.1% in the year-ago quarter.
Spansion revenue and net income history:
Spansion ended the year with $286.07 million in cash on its balance sheet, increased from $262.2 million a year prior.
For first quarter 2014, the company is expecting net sales in the range of $295 million to $320 million, and a GAAP net loss per share of $0.46 to $0.42.
Spanion trades with a P/B ratio of 1.9 and P/S ratio of 1.07, which is close to a two-year high of 1.12.