Canon Jumps Most in a Year on Speculation Forecast Conservative
April 27, 2011, 12:42 AM EDTBy Kazuyo Sawa and Mariko Yasu
April 27 (Bloomberg) -- Canon Inc., the world’s largest maker of cameras, climbed the most in more than a year in Tokyo trading on speculation the company’s revised forecasts for profit and sales this year were conservative.
Canon rose as much as 6.9 percent, the biggest intraday gain since December 2009, and traded up 6.4 percent at 3,720 yen as of 1:23 p.m. in Tokyo.
Japan’s March 11 earthquake and tsunami will cost the Tokyo-based company about 314.4 billion yen ($3.9 billion) in lost sales and 197.7 billion yen in operating income this year, Canon said yesterday while paring its earnings forecasts. Those costs were “within the assumption,” Citigroup Inc. said.
“The market reacted because it’s very likely Canon will reach its next fiscal year earnings forecast,” said Masahiro Shibano, a Tokyo-based analyst for Citigroup. “The market expects that Canon can get back to its full production level in the second half of the year.”
Net income in the year ending in December will probably fall 11 percent to 220 billion yen, Canon said yesterday, abandoning its previous forecast for a 26 percent increase. The company slashed its compact camera sales target to 20 million units from 23 million.
--Editors: Anand Krishnamoorthy, Suresh Seshadri.
To contact the reporters on this story: Kazuyo Sawa in Tokyo at ksawa3@bloomberg.net; Mariko Yasu in Tokyo at myasu@bloomberg.net.
To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net.
