IBTSIC downgrades its Wistron Corp recommendation

By Helen Ku  /  Staff reporter

Fri, Dec 28, 2012 - Page 14

IBTS Investment Consulting Co (IBTSIC, 台灣工銀投顧) has downgraded its recommendation on shares of Wistron Corp (緯創), citing concerns about the contract notebook maker’s sales for this quarter on weak replacement demand for Windows 8-based notebooks.

The investment consulting firm cut its rating on Wistron to “sell” from “neutral,” according to a report issued on Tuesday.

Shares of Wistron yesterday closed unchanged at NT$29.9 in Taipei trading, but are down 22.03 percent since the beginning of the year.

IBTSIC analyst Chen I-ling (陳以玲) forecast in the report that Wistron’s notebook shipments for this quarter would grow slightly from 7.45 million units to 7.6 million units on weak Windows 8 demand.

However, Wistron would still post a mild increase in sales this quarter thanks to TV orders from new customers and rising smartphone orders, Chen said.

The analyst predicted the company would report a consolidated revenue of NT$165.67 billion (US$5.7 billion), up 8.08 percent quarter-on-quarter, with a gross margin of 5.01 percent and earnings per share standing at NT$0.89.

For the whole of this year, IBTSIC estimated Wistron’s consolidated revenue would reach NT$654.79 billion, down 0.54 percent year-on-year, with net profit of NT$6.85 billion and earnings per share of NT$3.12.

Consolidated revenue would grow 5.51 percent to NT$690.85 billion next year, with net profit of NT$7.77 billion and earnings per share of NT$3.54, IBTSIC said.