Shares of Yageo Corp (國巨), the largest multi-layer ceramic capacitor maker in Taiwan, rose 1.24 percent yesterday after it reported that net profit last year increased more than 80 percent.
Yageo shares closed at NT$572, off a high of NT$583, outperforming the TAIEX, which closed up 0.47 percent at 16,255.18 after giving up some of its earlier gains.
“Its 2020 earnings sparked interest in the stock,” Hua Nan Securities Co (華南永昌證券) analyst Kevin Su (蘇俊宏) said.
“Yageo and other passive electronic component makers are expected to raise product prices in the second quarter, and the company could do even better this year,” Su said.
“However, the stock faced stiff technical resistance ahead of NT$600,” he said.
“I suspect there is not much room for its share price to go higher,” he said.
In a statement released on Thursday, Yageo reported net profit of NT$12.98 billion (US$460.5 million) for last year, up 86.9 percent from a year earlier, or earnings per share (EPS) of NT$27.58.
In the fourth quarter alone, the company’s net profit soared 314.9 percent from the same quarter a year earlier to NT$3.71 billion, or EPS of NT$7.51.
Last quarter’s EPS, the highest in eight quarters, beat the NT$7.37 of a quarter earlier and NT$2.31 in the fourth quarter of 2019.
Yageo’s EPS for all of last year of NT$27.58 far outpaced EPS of NT$16.35 reported for 2019.
The strong showing last quarter was largely the result of a merger with US-based Kemet Corp, which was completed in the third quarter last year, and high utilization of its production capacity in the greater China region, Yageo said.
Global demand for electronic components remained strong during the three-month period as a stay-at-home economy continued to boom, it said.
Yageo’s gross margin last quarter rose 4.5 percentage points from a year earlier to 38 percent, and 0.6 percentage points from a quarter earlier.
Yageo booked NT$952 million in foreign-exchange losses caused by a stronger New Taiwan dollar against the US dollar, which eroded fourth-quarter EPS by NT$1.93, the company said.
For last year as a whole, the company’s gross margin was 39.4 percent, up 3.6 percentage points from a year earlier, while its operating margin rose 6.4 percentage points from a year earlier to 25.8 percent.
The market expects the company’s consolidated sales this quarter to top NT$23 billion, which would be 3 to 4 percent higher than last quarter, and its net income to surpass NT$4.4 billion, which would be 15 percent higher than last quarter.
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