TomTom Stock Rises as Peugeot Orders Navivation Software
TomTom NV (TOM2), Europe’s largest maker of portable navigation devices, rose the most in six weeks in Amsterdam trading after sticking to its sales forecast and signing a supply deal with French automaker PSA Peugeot Citroen. (UG)
TomTom gained as much as 11 percent to 3.30 euros at 10:52 a.m., the biggest intraday gain since June 12. The stock has risen 8 percent this year, valuing the company at 731 million euros ($886 million).
Revenue this year will total about 1.1 billion euros, and earnings per share will amount to 35 cents, Amsterdam-based TomTom said today in a statement, reiterating a forecast from April. The Dutch company will provide Paris-based Peugeot, Europe’s second-biggest carmaker, with location and navigation technology for its vehicles’ entertainment systems, TomTom said in a separate statement.
“The contract win confirms TomTom’s strong position in European in-dash navigation market,” and the company reaffirmed its forecasts “despite weak consumer markets,” Niels de Zwart, an Amsterdam-based analyst at ING Groep NV (INGA) with a “hold” recommendation on the stock, said in a note today.
Second-quarter net income amounted to 8.9 million euros, beating the average analyst estimate of 6.4 million euros.
Last month, TomTom signed a global agreement with Apple Inc. (AAPL) for the use of digital maps in new mobile services. Revenue from that deal will start to come through next year, Chief Executive Officer Harold Goddijn today said on a conference call.
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