Is GigPeak Ready To Surge?

Is GigPeak Ready To Surge?

GigPeak, Inc. (NYSE:GIG) was formed by the founders of GigOptix acquiring Magnum Semiconductor and making the combined businesses a leading innovator of semiconductors and software solutions for high-speed connectivity and high-quality video compression over the Cloud.

The Company generated over $40 million in revenue for 2015, up 20% from the previous year. The previous quarter ending in March, net income growth was up 91% on sales of $11.9 million, that’s over 25% for the quarter.

In addition, there appears to be at least 2 million shares shorted which will cause a short squeeze in the coming days. GigPeak has approximately 70 million shares outstanding with about 90% of those shares in the float.

Here’s a breakdown of where those shares are held:

19.14% – Shares Held by All Insider and 5% Owners
20.30% – Shares Held by Institutional & Mutual Fund Owners
25.11% – Float Held by Institutional & Mutual Fund Owners
36 – Number of Institutions Holding Shares

Recently there was some news out regarding a couple law firms giving some of the GigPeak directors a hard time about a breach of fiduciary duties, this will likely unfold slowly, but doesn’t seem like a major issue for the Company. The management team is clearly highly qualified and well positioned to direct the company to continued profitability.

Earnings estimates for the Company will be out on July 25th and are estimated at 0.04 for the 2nd quarter 2016 and 0.19 for the year.

Valuation
P/E Ratio (TTM) 33.50
P/E Ratio (including extraordinary items) 48.87
Price to Sales Ratio 2.87
Price to Book Ratio 2.25
Price to Cash Flow Ratio 39.18
Enterprise Value to EBITDA 11.77
Enterprise Value to Sales 1.38
EPS (recurring) 0.03
EPS (basic) 0.03
EPS (diluted) 0.03


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