Wistron shares feel the sting of waning sales last month
CNATAIPEI -- Shares of Wistron Corp. were hammered Friday after the notebook computer ODM service provider reported a day earlier an almost 10 percent month-on-month decline in consolidated sales for July, dealers said.
August 10, 2013, 12:08 am TWN
The selling also reflected lingering concerns over weakening global demand for notebooks as many investors fear that Wistron's sales momentum will remain weak in the upcoming months, the dealers added.
Shares of Wistron fell 2.96 percent to close at NT$24.60 (US$0.82) with 17.31 million shares changing hands, while the weighted index on the Taiwan Stock Exchange ended down 0.65 percent at 7,856.14 points.
“Judging from the large turnover, I suspect the selling in Wistron shares largely came from foreign institutional investors who have been downbeat about the notebook market,” Horizon Securities analyst Benson Huang said.
“Foreign investors simply seized the poor July sales data as a cause to continue to unload their holdings after yesterday's net sell,” Huang said. On Thursday, foreign institutional investors sold a net of about 6.40 million Wistron shares.
In a statement released that day, Wistron said its consolidated sales for July totaled NT$48.62 billion, down 9 percent from a month earlier and also down 0.45 percent from a year earlier.
In the first seven months of this year, Wistron's consolidated sales fell 3.9 percent from a year earlier to NT$369.6 billion.
Wistron said its notebook shipments for July fell to 1.65 million units from 2.10 million units recorded in June. The July shipments were the lowest level in about a year.
Despite the disappointing July shipment figure, Wistron said it expects demand to pick up from August and that notebook shipments for the third quarter could stay unchanged or rise slightly from a quarter earlier.
“But after Acer Inc. reported poor second-quarter results Wednesday, market sentiment toward the PC sector has turned weaker.
Before Wistron is able to release satisfactory sales data, many investors preferred to stand on the sell side for the moment,” Huang said.
Taiwan-based PC vendor Acer posted NT$0.13 in loss per share for the April-June period, compared with NT$0.19 in earnings per share (EPS) recorded a quarter earlier.
Huang said his brokerage expects Wistron to post NT$2.7-NT$2.8 in EPS for 2013, down from NT$3.06 recorded a year earlier.
“Based on the 2013 earnings prospects, Wistron's valuation is not high at all, but many investors tended to keep their hands off the stock amid uncertainty over demand,” Huang said.