HTC Corp’s (宏達電) better-than-expected sales guidance for the first quarter made on Friday prompted several foreign brokerages to raise their target share prices on the stock, with Goldman Sachs expecting HTC to rise at least 56 percent over the next 12 months.
In a note to its clients over the weekend, the US brokerage raised its target price for HTC, the world’s largest maker of handsets running Windows Mobile and -Android -platforms, from NT$1,360 to NT$1,400, which represents a 56.42 percent upside from the stock’s closing price of NT$895 in Taipei trading yesterday.
The brokerage’s new target price on HTC was compared with Credit Suisse’s NT$1,040, UBS’ NT$1,150, Barclays’ NT$1,200 and NT$1,100 from both JPMorgan and Citigroup. Deutsche Bank offered a target price of NT$900.
The new target prices for HTC shares given by a slew of foreign brokerages came after the Taiwanese company said on Friday that it expected sales from this month to March to increase by about 147 percent from the level a year ago to NT$9.4 billion (US$322.9 million), while smartphone shipments would grow 157 percent year-on-year to 8.5 million units amid solid demand.
“HTC’s first-quarter guidance is above-seasonal, with better revenue from a richer [product] mix,” Credit Suisse analyst Pauline Chen (陳柏齡) said in a client note yesterday.
Goldman Sachs analyst Robert Chen (陳柏宇) said he expected HTC to introduce more impressive models during the Mobile World Congress next month, which could help boost the company’s sales in the second quarter.
However, some analysts may have been disappointed that HTC remained tight-lipped about its tablet PC plans during the teleconference on Friday.
“We believe most companies will struggle with profitability in tablet PCs, given Apple’s lower cost and aggressive pricing. We don’t believe HTC will be aggressive on tablet PCs,” Citigroup analyst Kevin Chang (張凱偉) wrote to clients on Saturday.