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AcBel shares jump on 2013 earnings, dividend proposal

TAIPEI--Shares of AcBel Polytech Inc. (康舒), a Taiwan-based power management system supplier, moved sharply higher Friday morning as investors hailed the company's almost 20 percent year-on-year increase in net profit for 2013, dealers said.

The buying also reflected a proposal by AcBel to issue a high cash dividend for 2013, which would represent a dividend payout ratio of more than 70 percent, they said.

As AcBel is now one of the local suppliers to the world's largest electric car maker Tesla Motors Inc., many investors have high hopes that the company's bottom line will continue to strengthen as Tesla is targeting the huge China market, dealers said. AcBel has been dubbed one of the “Tesla concept stocks.”

As of 11:14 a.m. Friday, shares of AcBel had risen by the maximum daily 7 percent to NT$38.15 (US$1.26), with 28.38 million shares changing hands. The weighted index on the Taiwan Stock Exchange was down 0.57 percent at 8,698.21 points.

“With the local bourse haunted by the volatility of the global markets, investors are seeking to park their funds in certain individual stocks such as AcBel that have sound fundamentals,” Grand Fortune Securities analyst Chen Wei-tai said.

“AcBel's growth in earnings is what investors want so they rushed to pick up the stock soon after the local main board opened,” Chen said. “The company is doing well in the development of power management solutions for consumer and industrial devices.”

At an investor conference Thursday, AcBel reported NT$1.25 billion in net profit for 2013, up by an annual 19.2 percent. Its earnings per share was NT$2.42, compared with NT$2.04 in 2012.

AcBel's gross margin for 2013 rose to 15.4 percent from 14.4 percent the previous year, driven by its efforts to adjust its product portfolio, although its consolidated sales only rose 0.8 percent annually to NT$24.60 billion.

In the fourth quarter of 2013 alone, AcBel posted NT$315 million in net profit, up by a quarterly 18 percent and an annual 21.6 percent.

Its fourth-quarter EPS was NT$0.61, up from NT$0.52 in the third quarter and NT$0.50 in the same period of the previous year.

AcBel remained upbeat about its earnings prospects, projecting that its 2014 sales and earnings will grow at a double-digit annual rate.

“AcBel is likely to reach its growth target in 2014 as it will soon ship power solutions to Tesla, which could become another driver of the Taiwanese company's growth,” Chen said.

At the investor conference, AcBel said it would issue NT$1.8 in cash dividend, representing a 74 percent dividend payout ratio, compared with its 2013 EPS.

“The dividend payout ratio is attractive. The announcement has also triggered buying in the stock today,” Chen said.

Based on AcBel's closing price of NT$35.70 on Thursday, the proposed cash dividend represented a yield of about 5 percent.

“With AcBel's great growth potential, its shares are likely to move higher in the near future,” Chen said.

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