To: Jenna who wrote (7570 ) 4/14/1998 9:06:00 AM From: AlienTech Read Replies (2) | Respond to
Watch CYMI another dr.$ favourite.SANMINA CORP. (SANM) 71 1/2 CLOSED. Shares of electronic contract manufacturer could set a good tone for the tech sector this morning as the stock of Sanmina rose by $3 last night after the company reported better-than-expected earnings. According to Sanmina, it earned $0.71 a share in Q2, four cents ahead of the First Call estimate, and 51% ahead of year-ago profit of $0.47 a share. Net sales in the latest period rose 28.6% to $172.15 million, while gross margins increased to 22% of total sales, up from 21% in the year-ago period. The company attributed the higher earnings and better margins on improved operating efficiencies as Sanmina was able to increase penetration in key geographic regions in the U.S. and grow its largest markets in the networking sector. The company also experienced good demand from its telecommunications, industrial and medical customers. News of the improved earnings prompted the stock to trade higher in after hours trading last night, and if this trend holds up this morning, it could also boost the shares of other contract manufacturers this morning. Given the circumstances in Asia that has affected the outlook in the past six months, many issues in this sector have been punished for their exposure to this region. However, Sanmina has managed to bounce back from the low reached late last year and at the start of the New Year, but the stock still trades about 21% below the high reached last September before the roof caved in on tech stocks. Last night's news about its fiscal Q2 should provide shareholders with some comfort and possibly help lead the sector out of its current quagmire.
