It is earnings season and LED and sapphire related companies continue to struggle due to the slow economic recovery and oversupply of sapphire. One financial analyst sees light at the end of the tunnel. In observation of Rubicon Technology (Nasdaq: RBCN) earnings last week, Canaccord Genuity’s Jed Dorsheimer found some positive signs for Rubicon and the sapphire industry.
According to Dorsheimer, “the sapphire industry is actually showing signs of stabilizing. While we do not expect much in the way of price increases again, we note that Rubicon is one of the low-cost providers in the industry. With this in mind, we feel that when the industry turns and inventory is worked down the increasing utilization should return a good amount of leverage and income to the model.”
Rubicon is already showing signs of recovery of the sapphire market with orders for two through four inch cores increasing in the first quarter. “We have continued to maintain high utilization of our crystal growth facilities throughout this slowdown because we are confident that demand will be strong in the second half of 2012,” commented Raja Parvez, Rubicon CEO and president, in the company’s earnings news release.
For Further Reading: Large Diameter Sapphire Supports LED Market Growth