Tue, Nov 16, 2010 - Page 11 News List

Yuanta positive on Acer, expects sales to rise this month

Staff writer, with CNA

Yuanta Securities (元大證券) yesterday said it was maintaining its “buy” recommendation on PC vendor Acer Inc (宏碁) on expectations that the company’s sales this month would show renewed momentum after being slowed by global inventory adjustments.

The brokerage also left its 12-month target price for Acer unchanged at NT$115, it said in a research note.

Yuanta Securities remained bullish about Acer despite the company’s disappointing unconsolidated sales last month.

Acer last week reported unconsolidated sales of NT$37.41 billion for last month, dropping 35.9 percent from September and 26.54 percent from a year earlier.

Though Acer suggested that investors use its consolidated sales as a reference to gain a complete picture of its operations, the company did not provide information on its consolidated sales for the month.

Yuanta Securities said that based on its survey of Acer’s notebook computer suppliers, their shipments to Acer last month fell about 10 percent.

The brokerage attributed the fall to inventory adjustments in the global distribution network and expected Acer’s revenues to recover this month when the market should be back in balance.

Despite its poor showing last month, Acer reaffirmed the guidance it gave at last month’s investors’ conference that consolidated sales in the fourth quarter would grow by 5 to 10 percent from the third quarter.

Yuanta Securities said it agreed with Acer’s forecast and suggested that investors consider the stock given its low valuations.

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