After the United States announced charges against the Huawei CFO some experts predicted a potential backlash from China. Some even compared
After the United States announced charges against the Huawei CFO some experts predicted a potential backlash from China. Some even compared the situation to the CFO of Apple or Amazon being arrested by Bejing. Below is a round up of what big bank analysts believe will be the fall out from the big news at Huawei.
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Stifel Nicholas
According to multiple sources, Huawei CFO Meng Wanzhou, daughter of the company founder Ren Zhengfei, has been arrested by Canadian officials. The arrest is said to have come about by request of the US government, which is currently looking into extradition for Ms. Meng, who faces charges stemming from potential violations of US-imposed sanctions against Iran. As confirmed by several sources, the arrest was made in Vancouver on December 1st, with an official extradition hearing set for Friday. While it is still too early to determine if a ban on sales of components to Huawei is likely – similar to what occurred with ZTE – we do expect weakness in shares within the optical component group as many have direct exposure to the vendor and believe the group is likely to remain under pressure until there is clarity on the potential for an equipment ban.
Nomura
Huwei’s CFO is reported to have been detained by the Canadian authorities owing to potential violations of US sanctions against Iran, leading to overall trade war concerns escalating again. Huawei has become the world’s third largest smartphone vendor this year, based on our estimates and we estimate it could be the second largest in 2019F.
Credit Suisse
The impact from a potential ban on Huawei from revenue disruption for foundries (TSMC, SMIC, Win Semi and VPEC) and equipment suppliers (CHPT) with high HiSilicon exposure.
