In the face of a continuing slowdown in US consumer spending, global PC makers that have more corporate clients and exposure to the Chinese market are likely to stand out, Credit Suisse said yesterday.
The Swiss brokerage’s comment came after US market researcher NPD Group released its latest study showing continued weak demand for consumer PCs in the US last month.
The NPD data showed that PC unit sales increased only 5 percent year-on-year last month, slower than the 7 percent growth in July and three-month trailing average of 10 percent growth.
Sales of desktops rose 23 percent year-on-year last month, while those of notebook units remained flattish, according to the Port Washington, New York-based research firm.
By brand name, China’s Lenovo Group Ltd (聯想) saw the fastest annual growth in consumer uptake, while the US’ Apple Inc, Japan’s Sony Corp and Taiwan’s Asustek Computer Inc (華碩電腦) also fared well last month. Japan’s Toshiba Corp and the US’ Dell Inc, however, lagged far behind in terms of increase in unit sales from a year earlier.
“We still maintain our conservative view of the downstream space, but believe companies with higher corporate and China exposure might perform better in the near term,” Credit Suisse analyst Robert Cheng (鄭勝榮) said in a client note.
Credit Suisse recommended Lenovo and Wistron Corp (緯創), Taiwan’s third-biggest contract PC maker, citing the two companies’ relatively higher China exposure compared with other PC makers.
The brokerage said it also favored Taiwan’s Synnex Technology International Corp (聯強國際), Asia’s biggest distributor of information technology products, which generates about 70 percent of its revenues from China.
It did not offer ratings on these companies nor its target prices for their shares.
Several Taiwanese PC makers — including Quanta Computer Inc (廣達電腦) and Compal Electronics Inc (仁寶電腦) — said earlier this month that they were cautious about US demand in the third quarter ahead of the year-end holiday season.
Still, other companies, such as Asustek and Acer Inc (宏碁), told investors recently that they had seen signs of increasing shipments this month ahead of China’s October holiday and a steady recovery in the European market after the second half of last month.
Credit Suisse said the NPD data, which were collected from the US commercial reseller and retail channels, offered valuable input because they represented the “sell-through” trend in the PC market, informing PC makers how strong the consumer purchasing trend is from the retail end.
In comparison, studies by other research companies such as IDC and Gartner measure “sell-in” data, which show trends in channel inventory.
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