10.12.2001
Accton revises up 2001 forecast

• Accton revised up its 2001 company forecast, long expected by the market. The firm has revised up pretax earnings forecast by 45% to NT$1.4bn, leaving EPS before tax at NT$3.80. Accton initiated the revision due to improvements in gross profit margin as the firm has shifted focus to higher-margin switches. We have also revised up our 2001 pretax earnings forecast to NT$1.49bn, with EPS after tax of NT$3.42, as the migration to high-margin products is happening faster than we originally anticipated. Although 4Q remains uncertain, we believe an up trend in broadband business will boost Accton’s revenue in 2002. As a result, we remain confident on the company’s long-term outlook, despite expectations of profit taking pressure in the short run (shares surged 27% in the recent rally).