Shares of Largan Precision Co (大立光), one of Taiwan’s leading smartphone camera lens suppliers, surged to a new record high yesterday, ending above the NT$2,000 mark after a foreign brokerage raised its target price for the stock, dealers said.
The strong buying also reflected optimism about Largan shipments amid hopes that “Apple-concept stocks” would benefit from the US company’s expected unveiling of its next generation iPhone later this year, dealers said.
The US consumer electronics giant accounts for about 40 percent of Largan’s total sales.
Largan shares rose 4.79 percent to close at NT$2,080, with 1.44 million shares changing hands. The TAIEX closed up 0.43 percent at 9,008.22 yesterday.
Extending the strength seen in the previous session, Largan opened higher in a knee-jerk reaction to a research report by CIMB Securities Ltd (聯昌證券), which raised its target price for the stock to NT$2,450 from NT$2,350.
The momentum continued until the end of the session as investors embraced hopes that Apple will launch new devices at the Worldwide Developers Conference on June 2, dealers said, adding they suspected the buying came largely from foreign institutional investors.
The stock remains the most expensive on the local market.
Other local Apple suppliers such as metal casing maker Catcher Technology Co (可成) and Hon Hai Precision Industry Co (鴻海精密) also gained during the session, climbing 3.7 percent to NT$280 and 1.09 percent to NT$93 respectively.
CIMB Securities said Largan could see a 33 percent sequential increase in sales in the second quarter, as Apple should start placing large orders next month for components for the next iPhone.
Largan is expected to win orders for its high-end camera lens, which will continue to strengthen its bottom line, the brokerage said.
It raised its forecast for Largan’s earnings per share by 2 to 4 percent for this year, next year and 2016, to NT$119.70, NT$143.90 and NT$161 respectively.
Barclays Capital Securities Taiwan Ltd said that with the release of Apple’s new products, Largan is expected to post a 50 to 60 percent increase in shipments in the second half of this year in comparison with the first half.
In April, Largan’s consolidated sales hit a record NT$3.21 billion (US$107 million), up 14 percent from the previous month and 68 percent year-on-year.
In the first four months of the year, the company’s consolidated sales rose 43 percent year-on-year to NT$10.06 billion.
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