Shares of personal computer vendor Acer Inc (宏碁) rose sharply yesterday as investors held high hopes that the company’s shipments will increase with the launch of its new low-cost tablet computers, dealers said.
Optimism about Acer’s tablet computer shipments spurred many bargain hunters to pick up the stock, which had been a laggard among the local PC firms, dealers said.
Acer shares rallied by 6.86 percent to NT$25.7 yesterday, outperforming the benchmark TAIEX, which gained 1.13 percent.
“Strong purchasing of Acer shares emerged soon after the local bourse opened, amid optimism about Acer’s new tablet computer,” MasterLink Securities (元富證券) analyst Tom Tang (湯忠謙) said. “It seems that many investors are buying into Acer’s upbeat assessment on the gadget it released on Monday.”
Speaking to the press, Scott Lin (林顯郎), Acer’s senior vice president and president of its greater China operations, said the company is planning to unveil more affordable tablet computers later this year.
Lin said that Acer has decided to introduce more low-cost tablets in light of the success of its 7-inch Inconia B1 model, which was released earlier this month at a price of NT$4,990 (US$169).
Within 10 days of its release 7,000 units of the tablet had been sold and its monthly sales in Taiwan are forecast to be around 10,000 units. Global shipments of the Iconia B1 model are likely to hit 400,000 units a month, Lin said.
“Like other listed companies in Taiwan, Acer tends to give positive leads to stir up buying interest in its shares,” Tang said. “Compared with other PC firms, Acer has been lagging behind its PC peers in valuation, but its strategy is working now because the local bourse is awash in liquidity.”
Acer shares came under pressure after the company announced a NT$3.5 billion intangible asset loss in its accounts last year, which many analysts said could keep the company in the red for the second consecutive year.
Tang said his brokerage has downgraded its forecast for Acer’s results for last year from NT$0.44 in earnings per share to a loss per share of NT$0.8, in view of the asset write-down.
“I doubt Acer’s efforts to sell low-cost tablet computers will boost its bottom line significantly as the pricing could depress the company’s profit margin,” Tang said.
Taking that factor into account, Acer could only post about NT$1.28 in earnings per share for last year, Tang said.
“I suspect the current buying in Acer shares is simply for trading purposes,” he said. “The stock may encounter strong profit-taking selling as it moves closer to NT$27.00.”