Hon Hai shares under pressure on Jan. sales data
February 12, 2014, 12:04 am TWN
TAIPEI, Taiwan -- Shares of Hon Hai Precision Industry Co. (鴻海精密) came under pressure Tuesday morning after the world's largest contract electronics maker reported a more than 30 percent month-on-month sales decline in January, dealers said.
The stock could face more downward pressure as investors fear the company will continue to feel the pinch of the traditionally slow first quarter, they said.
As of 11:02 a.m., shares of Hon Hai had fallen 1.47 percent to NT$80.50 (US$2.65) with 28.81 million shares changing hands. The weighted index on the Taiwan Stock Exchange was up 0.38 percent at 8,424.20.
"After clients' restocking in the fourth quarter of last year, momentum for the first quarter has slowed down. The January sales were the evidence, which led to selling in Hon Hai shares soon after the local bourse opened," Ta Ching Securities analyst Andy Hsu said.
"In addition, the slower January sales data reflected the reduced number of working days due to the Lunar New Year holiday," Hsu said.
The holiday in Taiwan fell between Jan. 30 and Feb. 4, but the Chinese factories of many Taiwan-based companies like Hon Hai started their vacations earlier in the month, losing several days of production.
In a statement released Monday, Hon Hai said it had consolidated sales of NT$314.55 billion in January, down 35.9 percent from December, but up 0.33 percent from a year earlier.
In the fourth quarter of last year, Hon Hai's consolidated sales hit a record high of NT$1.33 trillion, up 44.64 percent from the third quarter after Apple Inc. launched its latest iPhone models.
Apple accounts for more than 40 percent of Hon Hai's total sales.