Impinj jumps after analyst says best option in RFID 'tipping point'
Shares of radio frequency identification, or RFID, chip-maker Impinj (PI) are spiking after Morgan Stanley initiated coverage of the recently public semiconductor company with an Overweight rating. INTERNET-OF-THINGS IPO: Seattle-based Impinj listed on the Nasdaq on July 21. The company priced at the top of its range, at $14 per share, and closed up 28% to $17.97 on its first day of trading. The company makes tiny chips that are embedded in items, providing intelligence to retail, pharmaceutical, healthcare, food and beverage, and other industries. The company describes itself: "We enable the Internet of Things to identify, locate and authenticate billions of items, and our Item Intelligence platform comprises the most comprehensive and widely adopted RAIN RFID product portfolio in the world." On February 3, Research and Markets said the global intelligent RFID platform market will grow at a CAGR of 26.25% during the period 2017-2021. ANALYST VIEW: Morgan Stanley analyst Craig Hettenbach, who put a $40 price target on shares, wrote in a note to investors that Impinj is the "best way to play" the "tipping point" in "radio-frequency ID," or RFID, technology. "We see accelerating RFID adoption, as evidenced by a strong uptick in end point IC shipment growth for Impinj to 71% in 2016, up from 21%/52% in 2014/15. The company's initial focus markets of Retail and Healthcare offer a substantial ~$10B opportunity by 2020, while newer verticals such as Data Center, Travel, and Automotive should propel growth further." Just last week, following its fourth quarter earnings report, research firm Piper Jaffrey backed its prior Overweight rating and raised its price target to $36.50 per share. Piper Jaffray analyst Troy Jensen commented, "Impinj reported another strong quarter with Q4 revenues, margins and EPS all exceeding consensus expectations, with the upside being driven by robust demand for the company's portfolio of IC endpoints. In addition, the company provided upbeat Q1 revenue guidance, but EPS fell below expectations. Although EPS came in a bit softer than expected, we believe this guidance is beatable given the company's superior execution and history of providing conservative forecasts." PRICE ACTION: Shares of Impinj are up 8.5% to $30.91 per share in afternoon trading. OTHER RFID PLAYERS: Other companies in the space include Zebra Technologies (ZBRA), Gaming Partners GPIC), and Checkpoint Systems (CKP).