Wed, Sep 04, 2013 - Page 14 News List

Wistron stock soars on Apple contract rumors

Staff writer, with CNA

Wistron Corp (緯創) shares continued to rally yesterday on speculation that Apple Inc is likely to contract the Taiwanese contract manufacturer to assemble some of its new iPhones, dealers said.

Many investors hope that if Wistron, one of the nation’s leading contract notebook computer makers, receives orders from Apple, it would offset the impact of falling global demand for PCs, dealers said.

Wistron stock closed up 6.27 percent yesterday at NT$30.5.

“Speculation about possible orders from Apple dominated market sentiment toward Wistron shares, prompting many investors to buy into the stock soon after the market opened,” Hua Nan Securities (華南永昌證券) analyst Stan Chang said.

The rumors that Wistron is in talks with Apple to assemble new low-cost iPhones first reached the market on Monday and helped lift the company’s shares by almost 7 percent on the day.

“As the global PC market remains weak and continues taking a toll on Taiwanese contract makers, including Wistron, it was no surprise that any positive lead, like the speculation of orders from Apple, drove the stock higher,” Chang said.

Wistron declined to comment on the orders speculation, saying that its policy prevents it from saying anything about any specific clients or about market speculation.

The company did say that it has made a lot of effort to diversify its product portfolio to ease the impact the weakness of the global PC market is having on it.

In the second quarter, contract notebook computers accounted for 45 percent of Wistron’s total sales, down from 52 percent in the first quarter, as the company devoted more resources to smartphone and tablet computer manufacturing.

“Wistron has the technology to assemble smartphones since it has provided services to BlackBerry Ltd and it is possible for it to get orders from Apple,” Chang said.

“However, I doubt that as a newcomer to Apple’s supply chain, Wistron will receive a large volume of orders from the US company. Limited orders are unlikely to boost Wistron’s sales significantly,” he added.

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