HTC shares extend heavy losses, falling below NT$80
Shares of Taiwan-based smartphone vendor HTC Corp. took a beating to fall below NT$80 ( US$ 2.58) Tuesday morning, extending losses from a session earlier, after the company warned over the weekend that it could incur an almost NT$10 loss per share for the second quarter of this year, dealers said.
The current selling reflected investors’ lingering worries over HTC’s earnings outlook at a time when he global smartphone market’s growth has showed signs of moderating and escalating competition has placed grave pressure on the Taiwanese firm’s shipments, they said.
As of 10:57 a.m., shares of HTC had lost 10 percent, the maximum daily decline, to NT$75.30 with 7.39 million shares changing hands. The weighted index on the Taiwan Stock Exchange was down 0.85 percent at 9,288.36 points.
The stock fell 10 percent soon after the local bourse opened Tuesday after a 10 percent fall a session earlier as investors remained shocked by the company’s warning of a massive net loss for the April-June period, Taishin Securities Investment Advisory analyst Tony Huang said.
“To my knowledge, there have been orders placed by investors to sell about 18 million HTC shares for now,” Huang said. “The earnings warning still served as the culprit of the selling and I think the downturn will continue.”
Before the earnings warning, Huang said that many investors had high hopes that HTC would remain profitable in 2015 after it turned a profit in 2014, when its earnings per share stood at NT$1.80 compared with NT$1.60 in loss per share recorded a year earlier.
Not Likely to Profit This Year: Analyst
“But, it turned out that the company will incur a net loss of almost NT$10 in the second quarter. So it is unlikely for the company to report a net profit this year, which disappointed many investors and prompted them to cut their holdings in the stocks starting from Monday,” Huang said.