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Title:Asustek (2357 TT) Buy, TP: NT$275
Download File:2357 TT Asustek note 201022--sinopac.pdf 
 
Summary:Maintain Buy, raise TP by 2% to NT$275 (12x 2021F P/E): 1) 3Q20 sales beat owing to WFH/remote learning. 2) PC order visibility extends through 1Q21; we forecast 4Q20 YoY/QoQ sales growth of 36.1/3.9%. 3) GMĄ¯s return to the norm from a record high in 2Q20 will be slower than expected given AsustekĄ¯s strong sales momentum. We raise our 2020 EPS estimate to NT$28.4 (from NT$22.2) and our 2021 EPS estimate to NT$22.9 (from NT$21.3); the YoY drop is largely due to the very high base and normalization of PC demand. 4) Valuation: Asustek is trading at 10x 2021F P/E. We set our TP at 12x 2021F P/E. The yield of 7%, based on our DPS estimate of NT$15, offers downside protection. Our previous TP was NT$270.
  
Date:2020/10/22
Author:TaiwanResearch.com
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