CFRA Maintains Hold Rating On Shares Of Dolby Laboratories, Inc.
We lower our price target by $6 to $83, 22.5x our '24 EPS estimate, near DLB's 5-year average (~22.5x). We lower our '24 EPS view by $0.07 to $3.70 and raise our '25 estimate by $0.08 to $4.03. DLB reports Mar-Q sales of $365M (-3% Y/Y) and EPS of $1.27 (+1%), near consensus, while leaving its full-year guide unchanged. Dolby Atmos (DA) and Dolby Vision (DV) are gaining momentum in mobile, with the company announcing their adoption across an impressive number of new phones, including new releases by Xiaomi, Transsion, and Oppo. We also positively view the continued rollout of content supporting DA/DV, primarily in sports, with Max becoming the first streamer to adopt DA/DV across all of its live sports offerings, which we think will become more popular as consumers increasingly move away from cable. Still, more material growth numbers are unlikely until overall device sales rebound, which we do not expect this year, with unit volumes in automotive, mobile, and TV all projected to be relatively flat in CY 24. |
