Bloomberg News

Apple Supplier Catcher Surges After Price Estimate Raised

July 19, 2011

(Updates with closing price in the second paragraph.)

July 19 (Bloomberg) -- Catcher Technology Co., which makes metal casings for Apple Inc. computers, surged to the highest in more than four years in Taipei trading after three brokers raised their price estimates for the stock by 22 percent.

Catcher jumped by the 7 percent daily limit to NT$224.50, the highest close since Jan. 25, 2007. The stock, trading at a 2011 high of 17.7 times estimated profit, has more than doubled this year, while the island’s benchmark Taiex index has fallen 5 percent.

Citigroup Inc., Macquarie Group Ltd. and Bank of America- Merrill Lynch raised their share-price estimates for Catcher, with Macquarie saying the stock may climb to as high as NT$304. Catcher will probably supply parts for new Research In Motion Ltd. models and benefit from new Dell Inc. orders, according to two of the brokers.

“Catcher has demonstrated it is ahead of the competition by 12-16 months,” Wei Chen, a Citigroup analyst, said in a report yesterday.

Macquarie increased its estimate for the company’s 2011 gross margin to 43 percent from 39 percent. Catcher may report a gross margin of 40 percent, according to the median of 12 analyst estimates compiled by Bloomberg.

“We still think our margin assumption is conservative and expect Catcher to beat the street significantly,” Macquarie analysts including Daniel Chang said in a report dated yesterday.

James Wu, a Catcher spokesman, said the company has added two “international” clients this year, declining to specify company names. He said he couldn’t comment on the gross margin estimates for the year because of stock exchange regulations.

--Editors: Young-Sam Cho, Dave McCombs

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net.


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