Wed, Oct 14, 2009 - Page 12 News List

Acer shares drop on recall of laptops

By Kevin Chen  /  STAFF REPORTER

Acer Inc (宏碁), the world’s third-largest personal computer vendor, saw shares drop yesterday following a global recall of notebook models, despite upward ratings by analysts over the company’s solid third-quarter performance.

Shares of Acer fell 1.71 percent to NT$80.6 in Taipei trading. On Monday, the Taipei-based PC maker announced a recall of some of its Aspire laptops because of an overheating problem. It also posted a preliminary third-quarter revenue of NT$167 billion, up 5 percent from a year ago.

That represents a rise of 40 percent quarter-on-quarter and is higher than the company’s previous guidance of 35 percent. It is also Acer’s highest ever single-quarter revenue, beating a previous record of NT$159 billion for the third quarter of last year.

Morgan Stanley analyst Jasmine Lu (呂智穎) maintained an “overweight” rating on Acer and raised its target price to NT$92 from NT$90. He expected Acer to post growth of 4 percent to 5 percent in fourth-quarter revenue from the third quarter.

Credit Suisse analyst Robert Cheng (鄭勝榮) said Acer should see 10 percent quarterly growth in fourth-quarter revenue, given improving demand in Europe. He maintained an “outperform” rating on Acer, with a target price of NT$90.2.

Citigroup analyst Eve Jung (戎宜蘋) reiterated a “buy” rating with a target price of NT$88.

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