When asked about their recent success, Hurlston said one of the biggest improvements the company has made is diversifying its product portfolio to improve gross margins. Margins had historically been pegged at 38%, he said, but now are hovering near 55%.
Those improved margins have been driven by diversifying away from mobile products and into PCs and IoT devices. Mobile accounted for 63% of sales two years ago, but only accounts for 25% today. Meanwhile, IoT devices now make up 25% of sales.
Hurlston was also bullish on two recent acquisitions, which have added biometrics and fingerprint recognition to the product portfolio. Synaptics is now well positioned for the "hoteling" trend where employees share office space. Now one docking station can securely serve multiple employees.
Let's check out the charts and indicators of SYNA.
We last looked at SYNA way back on February 10, 2020 and recommended at that time, "Aggressive traders could use dips to around $80 to go long, risking a close below $74 for now. The $100 area and then the $122 area are our price targets." SYNA has reached and passed our price targets -- now what?
In the updated daily bar chart of SYNA, below, we can see a new rally phase from May. Prices have reached new heights as they trade above the rising 50-day moving average line and above the bullish 200-day moving average line.
The trading volume has been more active since the beginning of 2021 and the On-Balance-Volume (OBV) has been positive the past 12 months but needs to breakout to new highs to confirm the price gains. The Moving Average Convergence Divergence (MACD) oscillator is above the zero line in positive territory but has narrowed in recent days towards a potential take profit sell signal.
In the weekly Japanese candlestick chart of SYNA, below, we see a positive picture. Prices are in a longer-term uptrend above the rising 40-week moving average line. A lower shadow and doji in early May help to mark a low and turn higher.
The OBV line has moved higher the past two years to confirm and support the price gains. The MACD oscillator is crossing to the upside for a new outright buy signal.
In this daily Point and Figure chart of SYNA, below, we can see a $183 price target.
In this weekly Point and Figure chart of SYNA, below, we see that the software is projecting the $248 area as a potential price target.
Bottom-line strategy: If you are still long from our buy recommendation last year -- great! If you have no position you could go long at current levels risking to $139 for new and old positions. The new price targets for SYNA are $183 and then $200 and $248.