Goodbye HTC (... but not HelloMoto!)

I don't do much in the way of specific individual stock picks on this blog, but I wrote back in late June to go long HTC (2498 in Taiwan) "over the next few weeks".

"GoodbyeMoto... Hello HTC?!?!" I wrote after dissing the company here and calling a sell here earlier in very the same month.

Assuming "a few" weeks meant two, your average in price would have been NT$516, based on closings from the 26th on. As of yesterday's close, you'd be up 12.6%... compared with a Taiwan local market decline of ~0.7% on the same basis. Not too shabby. (Buying in over 3 weeks would've given an even more flattering in price, but who really does THAT in their PA!)

This week we have news from C|Net (and every broker in Taipei) of HTC's pioneering Google/Android phone set for a launch in September (just slightly earlier than expected,) with volume shipments in October. Look for positive newsflow, forecast revisions, recommendation upgrades and... opportunities to sell out... er... "over the next few weeks."



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Stumble It!
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GoodbyeMoto... HelloHTC?!?!

I thought HTC's much-vaunted Diamond was a bit of a snooze.

Then I saw this offering from Motorola - the catchily (not!) named MotoROKR E8 and realised that maybe the Diamond's not so bad after all.

While on the subject of good ol' HTC (see my previous bearish comments here), the Nokia deal last night to turn Symbian into the Symbian Foundation and go the Linux-like free route attracted a host of bearish comments, such as this one from my mates at Citi: (edited version)

• We believe this move is likely to give Symbian phone makers meaningful cost advantage over Window Mobile phone makers.
• We think it’s unlikely for Microsoft to eliminate or reduce software licensing fee in a meaningful way
• Despite HTC’s effort to diversify its Microsoft exposure, we estimate Android-based models will account for less than 10% of HTC's shipments in 2009.
• Without proprietary OS, HTC's product definition is highly restricted by Microsoft’s direction, which is not necessarily where HTC wants to go.
• Given high market expectations, substantial valuation re-rating and uncertainties ahead, we view HTC's risk-reward profile as unattractive.

Actually, Diamond's not so bad... and if Symbian's going free, then MSFT OS + Google Android focused HTC will have more toys to play with (at the cost of more R&D, of course, and the usual OEM/brand conflict that they are getting used to by now.) All that and piggybacking off a bigger pie if Nokia and the like start pushing and advertising SmartPhone applications as must-haves.

I'd be covering and would start to go long, and add over the next few weeks.

(Remember, this is not a portfolio position of ours.)

iPhone iMust-Have... except...

From Credit Suisse Japan:

1. No One-Seg* digital TV tuner
2. No e-wallet function
3. Weak camera
4. Only one panel color available
5. Display of cute emoticons, emoji, is difficult
6. A lot of Japanese already own an iPod Touch (launched in October 2007)
7. Japanese women with long fingernails will not buy it (and there are a lot of them)
8. School kids use cell phones mainly for emails using one thumb, a dialpad and a jog dial (ideal for Japanese character input)
9. Uncertainty of handset cost itself, accessories, data plans etc.
10. Japan is the toughest cell phone market in the world (high level of technical sophistication, critical customers, high innovation rate etc.)

(*One seg allows you to watch live tv, believe only used in japan. One seg also available on sony psp, nintendo ds - so popular and a must have for any gadgets.)


We shall see.

Meantime, AAPL seems poised for a correction of somewhere between 15 and 30%?

"Lieutenant Dan got me invested in some kind of fruit company. So then I got a call from him, saying we don't have to worry about money no more. And I said, that's good! One less thing."

iCheaper iPhone => iWant (... to sell HTC)

Rewind to my "Touch-a Touch-a Touch-a Touch me... etc" post on June 3rd... nothing prescient here about expecting the next generation 3G iPhone to come in at under 200 bucks on my part, but shows the vulnerability of HTC in this space... especially when your product's a ho-hum copy of an iconic cultural must-have for the techie, tai-tai and everybody else in 22+ territories...



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Was that "Touch-a Touch-a Touch-a Touch me..." reference a bit obscure??

• HTC has a touch screen phone called (by some unnamed creative genius in marketing) "TOUCH" and...
• The word "touch" still elicits a Pavlovian response when I hear it - ie an image of Susan Sarandon circa 1975 pops to mind (... shortly followed by some very Pavlovian salivating)
• "Touch-a Touch-a Touch-a Touch me... I wanna sell H T C..."

Six(-ish) weeks on, the PowerTech tug of war continues...

So, who's winning the CLSA vs Tom DeMark (amateurishly interpreted by yours truly) Clash of The Titans now? (See April 23rd entry.)


Argh! Neither of them! I can't wait!

Less popular than Bush after 100 days - Myung-bak "W" Lee

From a great salestrader at CLSA in Seoul this morning:

Today marks the 100th day since president MB Lee was inaugurated. He holds the unfortunate claim to fame as the most unpopular president in history with an approval rating of only 19.7%.

Obviously at risk are MB LEE's hard nosed stance against unions (AUTOMAKERS meeting labour unions soon), along with the start of the Grand Canal project (CONSTRUCTION names may come under pressure). BANK privatization may also be at risk, especially after the financial labour yday said they would strike beginning June 11 to protest the govt's fund-raising plan.

We'll see more protests today, with over 100,000 people expected to gather in Seoul to demonstrate against US beef imports. Expect another day of mayhem downtown - but hopefully more peaceful than what was seen over the weekend:

Neither Dave Thomas nor Clara Peller were seen there:

(Not too surprisingly, if you think about it.)

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From the Economist: KAL's take on Bush... and Brown... and Sarkozy...

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On the other hand, I am working on the idea that perhaps MB Lee will look to juice up his non-existent popularity by some wild fiscal spending and boost domestic feel-good (and consumption) that way... and perhaps end up further weakenening the Won, to the benefit of some tech exporters?? Just a thought.

Touch-a Touch-a Touch-a Touch me... Diamond launching in HK

I wanna get...

Snore

Nothing that much I can't see on my pirate 2G imported iPhone - maybe the market's expecting too much from High-Tech Computer (2498 TT) at 18 buys, 3 holds and 2 sells?

Brokers vs DeMark... PowerTech (6239 TT)

The Battleground:
Powertech Technology Inc. of Taiwan (which tests, packages, and assembles integrated circuits... including memory products, and provides various kinds of IC package services, according to Bloomberg... Basically a DRAM play.)

IN the RED corner, we have Tom DeMark's TD Sequential (daily) as interpreted by a rank beginner (me.) We've had two Perfected Sell Set-Up 9's (green bar counts) the last of which more or less coincided with the conclusion of a Sell Countdown 13 (red bar counts) and now here we are, closing today at NT$120.5, down 0.4% (with borrow available at 4%):

"A TD Sequential (TM) Sell '13' Countdown was recorded 8 bars back, on 04/11/2008 and is still active... Typically after a TD Sequential (TM) Sell '13' Countdown, the market will respond within 12 price bars."

AND in the BLUE corner... representing 15 brokers with buy recommendations (vs 1 hold and zero sells) we have CLSA (known as Credit Lyonnais once upon a time,) with a buy call issued on April 10th when trading at NT$114.5 with a LT target of NT$136... so far up by 5%... pretty good in under 2 weeks...

... but will it rise a further 13% to the CLSA target or drop 13-25% to hit the DeMark NT$90-105-ish range first?!

Dhruv Vohra says: "Powertech’s strong client relationships and the limited increase of the industry’s memory IC packaging and testing capacity suggests that Powertech will continue outperforming the Dram makers. We have raised our earnings estimates by 8% to factor in the better 1H08 revenue and profit margins. If average selling price pressures ease, there is the potential for even more upside..."

Admittedly, CLSA's is a 12 month call (I think) and the TD indicator suggests possible weakness over the next ~4 days (!) so both could easily be right... but that's a minor matter!

(Drum roll, please.)

Let's get ready to rumble!

(Apologies to and help sought from those who know better!)