May 28, 2022

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HTC shares price rise as a result of Google Intervention

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The shares value of HTC Corp rose earlier this Friday to 9.96 percent in Taiwan after the tech company confirms buyout of the firm by Alphabet Inc. Alphabet Inc is the group name of the company that has Google search engine and produce the Google Pixel’s smartphone.

Google Pixel segment of Alphabet purchased the HTC Corps mobile phone division for $1.1 billion. HTC has continues to make losses even after it launches the HTC U11 flagship that was taught to be the company’s messiah.

However, on the part of Alphabet, the intended purchase do not has any impact on the behaviour of investors. A report stated the opposite, that the company’s shares remain unchanged. After the announcement to buy HTC shares on Wednesday by Alphabet Inc. the companies shares on Wall Street Alphabet GOOGL was unchanged and closes as 0.1%. In S&P and Nasdaq stock market, the shares declined by 0.30% and 0.52% respectively. This revealed the lukewarm behaviour on the part of shareholders.

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This behaviour may has been as a result of the way Alphabet deals with Motorola after purchasing the tech company in 2012. Motorola was brought for $12.8 billion but was later sold to Lenovo in 2014. Though, this have tax benefits but its wasn’t beneficial to investors. At the purchased of Motorola, Alphabet shares rose from 2.5% to $1,135 after-hours activity.

Moreover, the behaviour of investors on Alphabet Google shares was uncalled for if you analysed Alphabet past behaviour and it’s present deal with HTC. As at the time of purchasing Motorola, Alphabet only deals with Software products and not hardware. This may be a reason for the Moto sale to Lenovo. However, Alphabet Google now makes deals with hardware product, starting from 2016. The Google Pixel line of smartphone, which was stated to be the best camera high ranged smartphone in 2016.

It is therefore certain that Google will not sell of HTC Corp after the deal is completed. Infact, about 2,000 HTC staff will be joining Google Pixel team to improve the quality of the Pixel device.

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If Google can make this clear to investors, it may change their behaviour to its’ shares or probably, when investors notices Google’s sincerity on the HTC deal, the share price of the tech firm will rise.

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