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HTC shares hit by April sales report

HTC shares hit by April sales report

Taipei, May 5 (CNA) Shares of HTC Corp. (???) were hit Tuesday morning by Monday's April sales report revealing a more than 30 percent month-on-month decline for the Taiwan-based smartphone maker, dealers said. The weak April sales data has triggered concerns that HTC will not be able to achieve its guidance for the second quarter amid escalating competition from both high-end model suppliers and budget model vendors, they said. As of 10:54 a.m., shares of HTC had fallen 2.82 percent to NT$120.50 (US$3.93) with 7.24 million shares changing hands. The weighted index on the Taiwan Stock Exchange was down 0.20 percent at 9,824.99 points. The stock plunged almost 4 percent soon after the local bourse opened to NT$119.00, the lowest share price in about nine months in response to the April sales data before some bargain hunting emerged to recoup part of the earlier losses, dealers said. "Although HTC shares recovered from its opening downturn to some extent, the stock remained technically fragile as investors fear that the smartphone vendor will not make an immediate turnaround, judging from the poor April sales data," Hua Nan Securities analyst Kevin Su said. In a statement released Monday, HTC said that it posted NT$13.5 billion in consolidated sales for April, down 33 percent from a month earlier and also down 39 percent from a year earlier. It was the lowest monthly revenue for April since the company had sales of NT$11.4 billion in April 2009. "The April sales showed that HTC failed to catch the market attention, although it launched the latest flagship model -- HTC One M9 -- (in March) at a time when competition in global high-end smartphone market has become fiercer than ever," Su said. Su said that HTC's formidable rivals Apple Inc. and Samsung Electronics Co. still hold the lead in the world's high-end smartphone market, while the Taiwanese vendor was simply struggling. In addition, HTC seemed to have also lagged behind in the budget smartphone business, Su said. "The April sales data has made many investors nervous that HTC will not be able to achieve its second quarter guidance which has already been shy of the earlier market expectations," Su said. In April, HTC said that it is likely to post revenue of NT$46 billion to NT$51 billion for the second quarter, with earnings per share of NT$0.06 to NT$0.34. That anticipated second quarter sales level would represent quarterly growth of 10.8 percent to 22.9 percent, lower than the average 50 percent growth estimated by analysts. The second quarter EPS is also lower than an earlier estimate of NT$1.89 made by some foreign brokerages. As result, several foreign brokerages have cut their target prices for HTC shares after the second quarter guidance. Among the downbeat foreign brokerages, JP Morgan Chase has even downgraded its target price for HTC shares to only NT$100 from NT$105. BNP Paribas, which has lowered its target price for HTC shares from NT$143 to NT$126, has cut its forecasts for HTC's EPS for 2015 and 2016 by 60 percent to NT$1.49 and NT$1.89, respectively, compared with NT$1.80 recorded in 2014. "Amid cautious sentiment toward HTC's earnings outlook, HTC shares could continue to remain in the doldrums," Su said. (By Esme Jiang and Frances Huang)


Updated : 2021-09-20 20:42 GMT+08:00