Shares of High Tech Computer Corp (宏達電) shot up by the 7 percent daily limit yesterday after a foreign investment researcher raised its target price more than 30 percent, to NT$653 (US$20), on strong demand for its products.
"The demand for High Tech's PDAs and smart phones has exceeded our anticipation," Vincent Chen (
The stock price of High Tech rocketed to set an all-time high at NT$551 yesterday on the Taiwan Stock Exchange, making it the most expensive stock among the 700 stocks trading on the nation's main bourse.
Turnover of the stock hit NT$6.85 billion, the highest among listed companies, according to statistics complied by the Taiwan Stock Exchange.
High Tech was also riding on a favorable macro environment, as the benchmark index TAIEX yesterday climbed 1.47 percent to 6,350.69 points with heavy turnover of NT$128.8 billion, hitting the highest level this year.
Chen said robust sales in October and last month reflected ongoing solid demand for its smart phones from telecom operator clients and original design manufacturing customers.
"The growth drivers for High Tech in 2006 include a push from operators for 3G, PDAs, smart phones and the launch of Microsoft's Direct Push Email, which competes with RIM's popular Blackberry system," Chen said.
On top of that, High Tech is expanding its client portfolio. Chen said High Tech will start supplying handsets to Japan's biggest cell phone carrier, NTT DoCoMo Inc, in the second half of next year.
High Tech, the world's biggest maker of smart phones operating on the Microsoft operating system, now supplies cellular phones to several European telecom operators including Vodafone Group PLC and handheld brands such as Palm.
As a result, Chen raised the 12-month target price for High Tech to NT$653 on Thursday from his previous NT$488, reiterating a "buy" rating on the stock.
CLSA's Chen also adjusted upwardly his financial forecast for High Tech for this year and next year by around 9 percent and 34 percent on the back of solid prospects.
The revised earnings for this year and next year are NT$10.86 billion, or NT$31.29 per share, and NT$17.94 billion, or NT$50.26 a share.
The rally spread to the over-the-counter Gretai Securities Market. Shares of the nation's top contract handset maker Compal Communications Inc (
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