NEW YORK, May 7 /PRNewswire/ -- As the computer hardware industry continues to grow, Standard & Poor's Equity Research Services sees it as a tale of two markets -- the U.S. and non-U.S. Consumer price competition and a slowdown in commercial orders, driven by middling corporate sales, has led to decreased growth from the U.S. computer hardware industry. At the same time, Asia and Europe have experienced rising sales of PC units, particularly for notebooks, as well as servers. These and other findings are available in a semi-annual report titled Computers: Hardware Industry Survey, published by Standard & Poor's, a leading provider of financial market intelligence.
While the worldwide personal computer industry enjoyed a fourth consecutive year of growth in 2006, investors should note that PC shipments in the U.S. increased a lackluster 3%, compared to hearty growth of an estimated 17.6% in per unit shipments in the Asia-Pacific region and even more robust 22.2% growth in Eastern Europe, Latin America and the Middle East. Standard & Poor's Equity Research sees the overall growth continuing for a fifth year in 2007 with 11% total unit growth.
"General industry data suggest that growth has been strong for the PC industry, but this is somewhat misleading," noted Scott Kessler, Technology Sector Group Head at Standard & Poor's Equity Research. "International markets are now critical to growth. Hewlett-Packard (HPQ: Hold; $43) and Acer benefited from gains in Europe, the Middle East and Asia (EMEA), and Lenovo added market share in Asia-Pacific, while Dell (DELL: Buy; $26), which has extensive U.S. market exposure, experienced a decline in units. We still see our 11% growth target as attainable, but investors should recognize that a number of variables, such as a decelerating global economy, sluggish enterprise spending, high energy prices and a continued housing market slump, could have a negative impact."
New operating systems from Microsoft Corp. (Vista) (MSFT: Buy; $31) and Apple Inc. (Leopard), along with further overseas development and the move towards notebook computers, will likely stimulate PC industry demand. Standard & Poor's Equity Research believes that prospects for Apple (NYSE:AAPL), which is ranked "Strong Buy" (5-STARS out of 5), are the brightest. The company's Macintosh (Mac) line of PCs is benefiting from multiple factors, including increased processing power from a switch to Intel- based chips, and its "boot camp" feature, which allows users to work in a Microsoft Windows-based environment.
Standard & Poor's Industry Surveys provide a broad and fundamental overview of each industry's structure, its recent performance, and an analysis of trends that are expected to influence it in the future. Each Survey is organized into the following sections: Current Environment, Industry Profile/Industry Trends, How the Industry Operates, Key Industry Ratios and Statistics, How to Analyze a Company, Industry References, Comparative Company Analysis, and a Glossary of terms used in that industry. Both text and data are provided, as are references to additional sources of industry information. Two surveys on each industry are published each year.
Readers can purchase Standard & Poor's Industry Surveys three ways:
Online for immediate download at http://sandp.ecnext.com, by telephone at 212-438-4052, or via e-mail order sent to bill_kelleher@standardandpoors.com. Members of the media can request a copy from the communications contact listed at the end of this release.
The analyst quoted above is a Standard & Poor's equity analyst. He has no affiliation with any company he covers, nor any ownership interest in any companies he covers.
About Standard & Poor's Equity Research Services
As the world's largest producer of independent equity research, Standard & Poor's licenses its research to over 1,000 institutions for their investors and advisors, including 19 of the top 20 securities firms, 13 of the top 20 banks, and 11 of the top 20 life insurance companies. Standard & Poor's team of 120 experienced U.S., European and Asian equity analysts use a fundamental, bottom-up approach to assess a global universe of approximately 2,000 equities across more than 120 industries worldwide. Follow Standard & Poor's equity analysts' U.S. market commentary each day at http://www.equityresearch.standardandpoors.com/.
The equity research reports and recommendations provided by Standard & Poor's Equity Research Services are performed separately from any other analytic activity of Standard & Poor's. Standard & Poor's Equity Research Services has no access to non-public information received by other units of Standard & Poor's. Standard & Poor's does not trade for its own account. The analytical and ethical conduct of Standard & Poor's equity analysts is governed by the firm's Research Objectivity Policy, a copy of which may also be found at www.standardandpoors.com.
About Standard & Poor's
Standard & Poor's, a division of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of financial market intelligence, including independent credit ratings, indices, risk evaluation, investment research and data. With approximately 8,500 employees, including wholly owned affiliates, located in 21 countries, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for more than 140 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com.
Source: Standard & Poor's