Sanyo Electric hits a new high as the Nikkei falls to the 15k level (from 17k) because Sanyo is experiencing strong growth in its cell phone and camera component sales. Now we all know that cell phone sales are weakening.....so this warrants a new high? Another one for the "Go figure!" dep't.....
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Sanyo Tops 1,000 Yen to More Than 10-Year High
Tokyo, Oct. 4 (Bloomberg) -- Sanyo Electric Co. shares rose as much as 3.7 percent, topping 1,000 yen for the first time in more than a decade on expectations the world's biggest supplier of mobile phone batteries will meet earnings targets a year ahead of schedule.
The shares rose as much as 37 yen to 1,031, their highest since Jan. 12, 1990. Sanyo was the second-most active stock by volume, with 14.23 million shares trading in the morning, and the fourth-most active by value on Japanese exchanges.
Surging demand for batteries used in cellular phones, personal computers and other mobile products is boosting the outlook at Sanyo. The Osaka-based company is on course to meet next year's earnings targets by the end of this fiscal year, analysts said.
``We're seeing the market for mobile goods expand beyond cellular phones into digital cameras and other products,'' said Yoichiro Higasa, an analyst at Marusan Securities Co., who rates Sanyo a ``buy.'' ``Batteries are definitely a must, which makes investors comfortable with Sanyo.''
Sanyo, which lost 26 billion yen in the year ended March 31, 1999, is in the midst of a three-year reorganization. Part of that plan calls for net profit of 35 billion yen and operating profit of 100 billion yen in the year to March 31, 2002.
``We're likely to meet that target a year in advance,'' Sanyo Executive Finance Officer Sunao Okubo told Bloomberg News last week. ``Our first-half earnings were better than we'd forecast. We're going to keep that momentum, no doubt about that.''
Sanyo in August boosted its projection for net income in the April-September period 81 percent to 19 billion yen and operating income 30 percent to 48 billion yen. It will raise its full-year forecast when it announces first half earnings on Oct. 27, Okubo said.
Its original forecast for the full year, announced in May, included net income of 25 billion yen, operating income of 80 billion yen and sales of 2 trillion yen.
Net income is likely to exceed 38 billion yen and could even top 42 billion yen, Marusan Securities' Higasa said. Sanyo's stock rally is being aided by setbacks at Apple Computer Inc. and Intel Corp., which have discouraged investors from buying the shares of companies with a focus on chips, he said.
Apple, maker of the colorful iMac personal computer, said Thursday fiscal fourth-quarter profit will fall short of analyst forecasts on slow sales of new products and computers for students. That followed warnings by Intel, the world's largest computer-chip maker, on Sept. 22 that third-quarter sales won't reach its own forecasts because of weaker demand in Europe.
Oct/04/2000 0:08 ET
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