Pixelworks (PXLW) — I last covered this designer of video and pixel-processing semiconductors and software for high-end digital video applications on June 16, at $7.73. The company’s technology includes Ultra HDTVs, also known as 4K, and it demonstrated similar technology for mobile applications.
On May 8, Pixelworks reported a Q1 loss of $0.04, beating analysts’ estimates of a $0.07 loss. Revenues of $13.5 million also topped estimates of $13.1 million. Consensus estimates are for a profit of $0.14 per share in 2014 and $0.44 in 2015. The company is scheduled to report quarterly earnings after the close on July 31.
This speculative small-cap growth stock was first featured as the Trade of the Day on Feb. 20, when it was trading near $5, based on positive technical analysis from our Profit Scanner tool. PXLW popped to a multiyear high of $9.05 on March 6, but then succumbed to high-volume profit-taking and retreated to $4.68 in early May. On April 11, I set a buy point at $5.50, and hopefully some readers bought at that level.
In June, I said the stock should be bought under $8 with a trading target of $10. It reached a high of $9.83 on July 23, before again succumbing to profit-taking. My recommendation remains the same: Speculative traders should buy PXLW under $8 with a price objective of $10.
Disclosure: Sam Collins owns shares of PXLW.