INSTANT VIEW: Sony posts surprise loss, sees good year ahead
TOKYO (Reuters) - Sony Corp (6758.T) reported a surprise quarterly loss as a weak stock market ate into the value of securities held by its life insurance division, but it forecast a bigger-than-expected profit this year as it boosts sales of digital cameras and flat TVs.
Following are some initial reactions from analysts and investors:
KAZUHARU MIURA, DAIWA INSTITUTE OF RESEARCH
"My first impression, prior to company checks, was that things are going smoothly at Sony.
"While Sony missed its targets, the main factors that hit its numbers were financial -- such as charges on convertible bond appraisal losses -- and other factors unrelated to its core operations. And in electronics and games, Sony looks to have been pretty much on target.
"Considering that Sony was operating under adverse economic conditions, including a strong yen, both the results and outlook seem to show that Sony's stamina has grown stronger and it is in better position now to fight a declining business climate.
TSUYOSHI SEGAWA, EQUITY STRATEGIST, SHINKO SECURITIES "There is little surprise -- positive or negative -- in the earnings results, and it is unclear how its stock will react."
"As its 2008/09 group forecasts beat analyst projections, it is not bad in terms of content. But the (proprietary trading system) showed some negative views soon after the announcement, so we expect sentiment to be split."
MITSUSHIGE AKINO, CHIEF FUND MANAGER AT ICHIYOSHI INVESTMENT
MANAGEMENT
"It was not a negative surprise. The stock probably won't be sold on this; it may even come in favor as the outlooks are not too negative.
"The (annual net profit) forecast of 290 billion yen appears to be conservative as the company assumes the yen will trade at around 100 yen against the dollar.
"Investors can hope for upward forecast revisions as the yen is currently trading above 100 yen against the dollar, and the economic outlook in North America has improved a bit now, compared to the January-March period.
"The game business is likely to drastically improve and the LCD TV business is also expected to be profitable. If Sony can accomplish these two things, it can easily lift its earnings forecasts, unless the yen starts trading around 90 yen."
KOICHI HARIYA, MIZUHO SECURITIES
"Profits fell short of the company's plan because of financial losses due to falls in share prices, but otherwise profit levels look firm.
"The forecast of 450 billion yen operating profits this financial year looks solid, given that there's been speculation that the yen's rise and slower U.S. growth could have a negative impact.
"The results could prompt bullish sentiment on Sony shares.
"The focus is on whether Sony's midterm growth strategy appeals to investors."
(Reporting by Kiyoshi Takenaka; Editing by Hugh Lawson)
