COPENHAGEN (Reuters) - Shares in William Demant (WDH.CO) fell almost 12 percent on Tuesday after the Danish hearing aid maker failed to raise its full-year guidance as some investors had hoped for.
“The shares were up 5 percent (on Monday)... and that is of course because some were speculating that there would be some kind of upgrade, and we don’t find occasion for that, so there must be some who are disappointed,” Chief Executive Soren Nielsen said.
The company said growth in the global hearing aid market was in line with expectations at 4 to 6 percent, but possibly at the lower end of that range. It said it continues to expect EBIT of 2.55-2.85 billion crowns (301-336 million pounds) in 2018.
William Demant shares were down 8.6 percent at 235.2 Danish crowns at 0938 GMT, up from a low of 227.6.
“In our view unit growth (assuming price discipline) is the best indicator of market impact and it appears that the company has experienced little in 2H FY17A and 2018 year to date,” Morgan Stanley analysts said in a note.
They said they expect William Demant to lose organic sales growth momentum in the second half of 2018 due to an ageing product line.
Monday’s 5 percent share price gain followed a strong performance recently.
“Some of Tuesday’s share price reaction could be seen as a result of the fact that the shares rose yesterday, and are up 50 percent this year so far,” Sydbank analyst Morten Imsgard said, adding that the company’s trading update was roughly in line with what he had expected.
Reporting by Emil Gjerding Nielson; editing by Jason Neely