Share prices of HTC Corp (宏達電), Asia’s second-largest smartphone maker, fell the most in two months in Taipei trading after forecasting first-quarter revenues that missed analyst estimates as it faces tougher competition in the US.
HTC share prices dropped by its 6.9 percent daily limit, the most on an intraday basis since Dec. 5 last year, ending trading at NT$513.
Trading volume was double the three-month daily average. Sales this quarter will be NT$65 billion (US$2.2 billion) to NT$70 billion, the Taoyuan-based company said on Monday. That is the lowest since the second quarter of 2010 and below the NT$84.9 billion average of 14 analyst estimates.
Competition from Apple Inc’s iPhone and Samsung Electronics Co’s Galaxy models damped demand for HTC devices in the US, while sales of faster LTE fourth-generation models did not meet expectations, chief financial officer Winston Yung (容覺生) said on Monday.
New models will be released next quarter, prompting the weak guidance this period as the company awaits “product transition,” Yung said.
“HTC is likely to lose further economies of scale in manufacturing in 2012 and 2013, as we forecast its shipments for 2012 to decline further to one-third of those of Samsung and Apple, down from half for 2011,” Alex Chang, an analyst at Daiwa Capital Markets in Taipei, wrote in a report yesterday.
Daiwa downgraded the stock to “sell” from “hold” and lowered the six-month target price to NT$333.
HTC became the largest smartphone maker in the US during the third quarter as consumers awaited the next iPhone model, according to data from researcher Canalys. HTC cut its fourth-quarter sales outlook on Nov. 23 by more than 20 percent, citing competition from the iPhone 4S.
Thirteen of 35 analysts tracked by Bloomberg now recommend investors sell the stock, with eight saying “buy” and 14 advising to “hold.”
HTC will release new models at the Mobile World Congress to be held in Barcelona, Spain, beginning on Feb. 27, Yolanda Wang, a Taipei-based analyst at HSBC Holdings PLC, wrote in a report.
She maintained her “underweight” rating on the stock and cut her price estimate 6 percent to NT$386.
Share prices, which have risen 4 percent this year, dropped 42 percent last year and are down more than 58 percent from their peak in April last year.