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Acer shares jump on optimism over tablet computer sales
Central News Agency
2013-01-29 12:17 PM
Taipei, Jan. 29 (CNA) Shares of personal computer vendor Acer Inc. moved sharply higher Tuesday morning as investors held high hopes that the company's shipments will increase with the launch of its low-cost tablet computers, dealers said. Optimism toward Acer's tablet computer shipments spurred many bargain hunters to pick up the stock, which had been a laggard among the local PC firms, dealers said. As of 11:15 a.m., shares of Acer had climbed 4.37 percent to NT$25.10 (US$0.85), with 24.39 million shares changing hands. The benchmark weighted index on the Taiwan Stock Exchange was up 0.71 percent at 7,769.54 points. "Strong buying in Acer shares emerged soon after the local bourse opened, amid optimism about Acer's new tablet computer," MasterLink Securities analyst Tom Tang said. "It seems that many investors are buying into Acer's upbeat assessment on the gadget it released yesterday." Speaking to the press Monday, Scott Lin, Acer's senior vice president and president of its greater China operations, said the company is planning to unveil more affordable tablet computers later this year. Lin said Acer decided to introduce more low-cost tablets in light of the success of its 7-inch Inconia B1 model, which was released earlier this month at a price of NT$4,990. Within 10 days of its release, the tablet had sold 7,000 units and its monthly sales in Taiwan are forecast at around 10,000 units. The global shipments of the Iconia B1 model are likely to hit 400,000 units a month, according to Lin. "Like other listed companies in Taiwan, Acer tends to give positive leads to stir up buying interest in its shares," Tang said. "Compared with other PC firms, Acer has been lagging behind it PC peers in valuation, but its strategy is working now because the local bourse is awash in liquidity." Acer shares came under pressure after the company announced a NT$3.5 billion intangible asset loss in its 2012 accounts, which many analysts said could keep the company in the red for the second consecutive year. Tang said his brokerage has downgraded its forecast for Acer's 2012 results from NT$0.44 in earnings per share to a loss per share of NT$0.8, in view of the asset write-down. "I doubt Acer's efforts to sell low-cost tablet computers will boost its bottom line significantly as the pricing could depress the company's profit margin," Tang said. Taking that factor into account, Acer could post only about NT$1.28 in EPS for 2012, Tang said. "I suspect the current buying in Acer shares is simply for trading purposes," he said. "The stock may encounter strong profit-taking selling as it moves closer to NT$27.00." (By Frances Huang)
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