Boston, MA 05/02/2014 (wallstreetpr) – Kulicke and Soffa Industries Inc. (NASDAQ:KLIC) has a cash hoard of about $556 million that represents about 60 percent of its market cap. Though the primary intent of building the large cash position in the company was to facilitate future acquisitions, the company may return some of that money to shareholders in the form of buybacks.
Lemelson Capital Management recently disclosed building position in Kulicke and Soffa. It already has about 1 percent stake of the company and is determined to acquire more shares. In any case, the hedge fund’s manager Emmanuel Lemelson termed the company as “absurdly undervalued.” As Mr. Lemelson builds big position in the company, he urged the management to considered shares repurchase using cash hoard. He observed that shares repurchase will not only come as a much-needed reward for shareholders, but also improve the value of remaining shares.
Kulicke and Soffa Industries Inc. (NASDAQ:KLIC) seeks to expand into more markets and the company identified organic growth and acquisitions as the ways to grow.
Q2 in numbers
The semiconductor assembly equipment maker reported Q22014 earnings that exceeded Wall Street expectations. The company generated revenue of $114.2 million, up 7.6 percent over the same period a year earlier. The quarter saw the company earning 12 cents per diluted share. However, analysts expected earnings per share of 11 cents on revenue of 115 million.
On top of the encouraging Q2 results, the company issued strong guidance for the current quarter. Therefore, the company expects to generate revenue between $165 and $175 million in Q3. However, analysts expect the company to report revenue of $154.42 million for the quarter.
Executive comment
According to the CEO Bruno Guilmart, the company noted strong demand for their products in many of the markets served. As such, he expects a strong demand to continue through the June quarter. Moreover, planned expansion into the adjacent markets should also lead to higher revenue and profits.
The company makes and sells capital equipment and tools used in the semiconductor and LED industries.
