Shares of Largan soar on September sales, optimism for month to come
Shares of Largan Precision Co. ( ) moved sharply higher Tuesday morning after the smartphone camera lens supplier reported better-than-expected sales for September, dealers said.
The buying also reflected Largan’s upbeat forecast that its sales for October will continue to grow, with analysts attributing the potential growth to an increase in orders placed by Apple Inc. for its new iPhones, they said.
As of 12:22 p.m., shares of Largan had added 8.27 percent to NT$2,685.00 ( US$32.11), with 1.82 shares changing hands. The weighted index on the Taiwan Stock Exchange was up 0.66 percent at 8,407.25.
Largan shares attracted strong interest soon after the Taiwan’s stock exchange opened, and momentum continued as bargain hunters seized on the September sales report as a reason to pick up the stock, which had suffered heavy losses amid recent speculation that Apple had shifted orders from Largan to its rivals, dealers said.
In a statement released Monday, Largan said it had NT$5.52 billion in consolidated sales in September, up 4 percent from a month earlier and also up 19 percent from a year earlier.
Seventh Consecutive Month
New High in Sales
It was the seventh consecutive month in which Largan reported a new high in monthly sales for 2015.
The 4 percent month-on-month sales growth beat an earlier company prediction that said September revenue would be little changed from August.
The cautious forecast worried investors at a time when Apple was launching its new iPhones and sparked fears that the U.S. firm had shifted orders away from Largan to other suppliers.
In September, 10-mega pixel or more advanced lenses accounted for 40-50 percent of its total sales, little changed from a month earlier, while 8-mega pixel lenses made up 20-30 percent of the company’s revenue.
The figures indicated that sophisticated camera lenses with higher profit margins weighed heavily in Largan’s product portfolio.
Largan said that based on its current order backlog, October sales may exceed September’s, prompting investors to pour more funds into the stock Tuesday morning.
Largan said it will report its complete third-quarter results and its forecast for the fourth quarter at an investor conference scheduled for mid-October.
NT$16.09 Bil. in Consolidated Sales in Q3
In the third quarter, Largan posted NT$16.09 billion in consolidated sales, up 17 percent from a quarter earlier and also up 33 percent from a year earlier.
In the first nine months of this year, Largan’s consolidated sales rose 40 percent from a year earlier to NT$40.43 billion.
Market sources said two factories rented by Largan are scheduled to begin operations in the fourth quarter in a bid to meet rising demand from Apple, whose 4.7-inch iPhone 6s and 5.5-inch iPhone 6s Plus have been on sale globally since late September.