Sony shares bounce back uncertainty removed

 Sony shares are bouncing back. Analysts say the company's warning yesterday that it could post a third straight annual net loss, helped remove an element of uncertainty.

Sony shares bounced from a two-month low Tuesday (May 24) as investors welcomed the certainty that comes with the company's latest earnings revisions.

The Japanese consumer technology giant says it expects a big net loss for the business year that ended March 2011, but says operating profit will come in at $2.4 billion.

More critically for investors, Sony is targeting a similar level of operating profit for the new business year that started in April.

Analysts say the revisions now provide a realistic view of the impact of the March 11 quake and a PlayStation network hacking incident that saw as many as 100 million customer accounts compromised.

The news prompted an upgrade on the stock from Macquarie, while others like Morgan Stanley, Credit Suisse and UBS repeated overweight and buy recommendations.

Macquarie also points out that Sony shares are now cheap, given a 260 billion yen fall in market value, compared to a 164 billion yen impact on operating profit from quake and hacking related costs.

Sony is scheduled to unveil its full earnings results on Thursday (May 26).

Its shares rose as much as 3 percent Tuesday (May 24) compared to flat trade in the broader market.

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