Hiwin shows no improvement in May 2012

by SR on June 8, 2012

A pause for Hiwin in May

Hiwin year-to-date sales (NT$ million)

  • Conclusion: marking time. We follow Hiwin because it’s one of the world’s leading suppliers of ball screws, a key component of machine tools and other high precision equipment. If its sales and orders aren’t picking up at Hiwin, not much is going on. Looking at the recently announced sales figures for May 2012 revenues fell by 4% MoM, to NT$1,003m, not a substantial sequential decline. Year-on-year sales fell 17%, but that was just a function of a big sequential step-up in sales in May 2011. I still have the sense that the worst is past for this particular company, but look at the year-to-date (cumulative) sales chart above. The blue line for 2012 is still well below 2011 (purple line) and it’s pretty clear that Hiwin is going to be down year-on-year in 2012. While the chart further down showing the monthly year-on-year change in sales seems to have bottomed, I expect sales to remain in the -10% to -20% YoY zone for several months to come. Of course, if orders come storming back in the second half, that might turn out to be pessimistic. But there’s a lot of expectations for the second half and the second half starts, let me see, 23 days from today. So, wouldn’t you rather be looking at Toyota or related auto parts stocks like Denso instead, where you have a nice, easy story of year-on-year growth?
  • See this post for our earlier comments on Google (yes, that one) Hiwin, Greece and the capex cycle.

Hiwin Tech monthly sales, year-on-year change in percent

Hiwin Tech monthly sales in NT$ million

Hiwin Tech share price (NT$)

Hiwin Tech, year-on-year change in cumulative sales, year-to-date

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