AST Stock Up After Favorable Report on New Products
IRVINE — AST Research Inc.’s stock flirted with its 52-week high Wednesday after a Wall Street analyst issued a favorable report about several new AST products.
In a report Wednesday, Daniel C. Benton, an analyst with the New York investment firm Goldman, Sachs & Co., raised his earnings estimates for AST, citing the “outstanding†market acceptance of the Irvine firm’s new notebook and workstation computers.
AST’s stock closed Wednesday at $27 per share, up $1.50, in over-the-counter trading. The stock reached a high of $27.25 earlier this year.
An AST official said the company has received big orders for its new line of notebook-size computers introduced earlier this month as well as its low-priced, high-powered personal computers known as workstations.
Benton’s report estimated that AST could sell 10,000 notebook computers in the quarter that ends March 31, 1991. That would translate into three-month sales of more than $30 million from notebook computers alone, he said.
“We believe that AST has an outstanding opportunity to make a major impact on the notebook market,†Benton said. “The lack of product from (International Business Machines Corp.) and (Apple Computer Inc.) has opened the distribution channel to new competitors.â€
Moreover, AST’s low-priced workstations--used by engineers, scientists and the like--have also been a hit in the market, Benton said.
The Goldman, Sachs analyst raised his earnings estimate for AST to $42 million, from $39 million, for the fiscal year that ends June 30, 1991.
As a result of strong sales and a continuing international expansion, AST will hire about 100 people at its Fountain Valley plant during the first three months of 1991, said Richard Ottaviano, vice president of human resources.
AST had planned to keep its employment flat because of concerns about the national economy, Ottaviano said, but recently decided the additional jobs were needed to meet demand for its products.
The Fountain Valley plant, which employs 500 of AST’s 2,300-member work force, makes a wide range of personal computers, including the company’s new notebook computer.
For its first quarter ended Sept. 28, AST’s earnings soared 393% to $11.4 million from $2.9 million a year earlier. Sales jumped 19% to $136.3 million from $114.5 million.
