OmniVision Technologies, Inc. (OVTI), Sony Corporation (ADR) (SNE): Take a Picture of These Great Stocks

Financial Snapshot

Sony Corporation (ADR) (NYSE:SNE) continues to be a revenue-generating behemoth, bringing in just over $67 billion for fiscal year 2013, which ended in March. This is a 4.7% increase over the prior year, and the first up-tick in year-over-year growth since their 2008 fiscal year. Gross profit margins have kept above the 20% mark over the past three years, and their EBITDA margin rose from 4% in FY2012 to 4.4% in FY2013. On a great financial note, it has turned a prior year loss of $4.5 billion into a net income of $429 million.

Outlook

The stock has been on an upward swing for all of this trading year. It has climbed 100% since January, and it seems to not want to slow either. The reason behind this is where analysts have pegged year-over-year revenue growth, at 9.84%, which is double that of the prior year. By FY2016, analysts estimate Sony will bring in over $76 billion in revenue and $1.18 EPS.

Even with its products represented in multiple cellphones and smartphones, it is virtually impossible for an uptick in global mobile phone sales to affect Sony’s top line to the point to make it an explosive growth story. With that being said, if it keeps its current trading multiple, Sony could trade as high as $50.00 per share.

Conclusion

For investors seeking to play the smartphone camera market, my focus would be on the smaller suppliers, namely OmniVision. Investing in its stock will give focused exposure to a growing industry. By supplying one of the world’s leading smartphone makers, Apple Inc. (NASDAQ:AAPL), it is poised to curb market risk by continuing innovation, and could offer a significant rate of return should they expand their reach into Apple Inc. (NASDAQ:AAPL) products.

Michael Mandala has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Michael is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

The article Take a Picture of These Great Stocks originally appeared on Fool.com is written by Michael Mandala.

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