Shares of Inventec Corp (英業達), one of Taiwan’s leading notebook computer original design manufacturing service providers, soared yesterday morning after it reported better-than-expected shipments for the third quarter, dealers said.
Many investors have high hopes that Inventec’s bottom line for July to last month will improve on the back of its solid shipments data and its efforts to diversify its product portfolio, dealers said.
Inventec’s stock price rallied 3.77 percent to end at NT$28.9. The weighted index was up 0.05 percent at 8,362.87 points.
“The higher-than-expected shipments largely reflected increasing orders from two of Inventec’s major customers — Hewlett-Packard [HP] and Toshiba — that have launched new models to encourage buying,” Ta Ching Securities (大慶證券) analyst Andy Hsu said.
Inventec said its notebook computer shipments for the third quarter hit 5.95 million units, up 32.2 percent from the second quarter and surpassing the company’s August forecast of about a 10 percent increase.
Last month alone, Inventec’s notebook computer shipments rose to 2.35 million units, up 17.5 percent from the August figure of 2 million units. The company recorded shipments of 1.6 million units in July. Last month’s figure was the highest so far this year.
“Many consumers had put their purchasing plans on hold, waiting for new models from international brands such as HP and Toshiba. That’s why Inventec’s notebook computer shipments rose from month to month in the third quarter,” Hsu said.
In the first nine months of this year, Inventec’s notebook computer shipments totaled 14.40 million units and the total for the full year is widely expected to surpass the 17 million units recorded last year.
Hsu said the better-than-expected shipments are likely to strengthen Inventec’s profitability for the third quarter, an expectation that prompted many investors to pick up the stock soon after the local bourse opened.
“Inventec’s earnings per share for the July to last month period is likely to range between NT$0.6 and NT$0.7, compared with NT$0.45 in the second quarter,” Hsu said. “Gross margin is expected to continue to improve in the third quarter.”
In the second quarter, the company’s gross margin stood at 5 percent, up from 4.9 percent in the first quarter.
“I suspect the buying in Inventec shares came largely from foreign institutional investors, who picked up a net 356 million Inventec shares between July 1 and Oct. 3,” Hsu said.
With the strong foreign institutional buying, Inventec shares rose more than 66 percent between July 1 and Thursday, according to stock exchange statistics.
“The stock has become technically healthier than ever. I think it will be not at all difficult for Inventec shares to challenge NT$30 in the short term,” Hsu said.