Sequans Communications S A (SQNS) Receives a Buy from Needham

In a report released today, Quinn Bolton from Needham maintained a Buy rating on Sequans Communications S A (NYSE: SQNS), with a price target of $1.75. The company’s shares opened today at $1.30.

Bolton noted:

“SQNS’ 3Q18 revenue and GM missed the company’s guidance due to delays in customers’ IoT projects. Management expects 4Q18 results to be similar to 3Q18 results, but due to uncertainty around timing of IoT device launches, SQNS will not be providing quarterly guidance until visibility improves. SQNS extended the maturity of its 2015 convertible notes and secured $18MM in additional debt financing including the issuance of an additional $4.5MM in convertible notes and 12MM Euro of venture debt. These actions obviate the need for a dilutive equity financing and should fund operations through 2019. While we continue to believe in the long-term growth prospects of Sequans’ IoT business, we are reducing our estimates and PT to $1.75 from $2.50, based on an EV of ~2.5x estimated 2020 sales.”

According to TipRanks.com, Bolton is a 5-star analyst with an average return of 12.6% and a 58.9% success rate. Bolton covers the Consumer Goods sector, focusing on stocks such as MACOM Technology Solutions Holdings Inc, Quantenna Communications, and Integrated Device Tech.

Currently, the analyst consensus on Sequans Communications S A is a Strong Buy with an average price target of $2.64, which is a 103.1% upside from current levels. In a report released today, Canaccord Genuity also maintained a Buy rating on the stock with a $2.50 price target.

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Based on Sequans Communications S A’s latest earnings release for the quarter ending March 31, the company reported a quarterly GAAP net loss of $8.77 million. In comparison, last year the company had a GAAP net loss of $7.41 million.

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Sequans Communications SA designs, develops and supplies 4G LTE semiconductor solutions for wireless mobile broadband applications with a focus on the single-mode device market. Its solutions incorporate baseband processor and radio frequency, transceiver integrated circuits, along with its proprietary signal processing techniques, algorithms and software stacks. The company’s solutions serve as the core wireless broadband communications platform in devices, including smart phone’s, USB dongles, portable routers, embedded wireless modems for laptops, net books, tablets, and other consumer multimedia and industrial devices, consumer premises equipment, such as residential gateways, and base stations. Sequans Communications was founded by Georges Karam and Bertrand Debray in September 2003 and is headquartered in Paris, France.