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Image Sensor Company Omnivision Technologies Looks Well-Positioned for the Long Run

August 20, 2014 | About:
rusticnomad

rusticnomad

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Omnivision Technologies (OVTI) finished fiscal 2014 on a solid note. The organization beat analysts' estimates handsomely while the viewpoint also blew past expectations. Known for supplying picture sensors to Apple (AAPL), Omnivision has done well. A glance at its prospects and item advancement will reveal that Omnivision can still scale more prominent heights.

Prospects in the car market

The organization expects the selection of its technology in new products and applications to improve its addressable business. Omnivision has had the capacity to diversify its revenue base by moving into the auto and security markets. Case in point, its Ov10630 solution was selected by Tesla Motors (TSLA) to empower progressed back perspective Polaroid application 18 months prior.

The electric vehicle showcase in the U.S. developed 33% year-over-year in the first six months of 2014. Looking ahead, Tesla is looking to add more models to its lineup. It as of late idled its California plant to outfit it with robots keeping in mind the end goal to boost generation. Tesla is getting ready to dispatch the Model X SUV. This is uplifting news for Omnivision, as it should see an increase in the addressable open door because of Tesla's extending creation.

Likewise, Omnivision has included distortion remedy and light sensitivity to its car sensors. On the once more of such item advancement moves, Omnivision can keep profiting from the auto business going ahead.

Mobile prospects

Past auto, the mobile devices business presents an enormous open door for Omnivision. Increasing sales of minimal effort 3g smartphones, along with the move to 4g LTE in China are driving development in the smartphone class. Moreover, the approaching iPhone 6 is an alternate catalyst as it is relied upon to result in stronger interest for its picture sensors.

This is relied upon to be a blockbuster year for Apple with analysts anticipating that the organization will ship 180 million iPhone units. The iPhone producer is relied upon to convey two devices this year, unified with a 4.7-inch screen and an alternate with a 5.5-inch screen. Greater devices are relied upon to help Apple enhance its position in the smartphone advertise as sales of bigger devices have been on the rise.

China is a standout amongst the most essential markets for extra large screen phones. This share is estimated to develop to half in the following three years. Fruit has entered into an arrangement with China Mobile, and this will be leeway for the smartphone creator, furthermore extend Omnivision's addressable business sector.

Omnivision is focused on development to tap the smartphone, tablet and PC markets. It is taking a shot at new technology, such as 3D profundity data, using photography to improve picture quality and transition to higher resolution. Omnivision is also creating new human interface applications, such as gesture control distinguishment and eye following.

The organization's new flagship Purecel technology is also picking up appropriation. Purecel is required to improve the performance of smartphones and tablets with its light sensitivity and cost advancement. The organization had shipped around 200 million sensors in the final quarter and is planning to increase its Purecel sensor volume aggressively to address stretchd business opportunities.

Conclusion

Omnivision Technologies is focusing on key development opportunities such as car and mobile devices. Both these markets are developing quickly, and Omnivision is looking to tap both with its item advancement. Also, the stock is shabby at a trailing P/E proportion of 13, route underneath the 35x industry normal, which makes it a decent long haul pick at current levels.


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