AST Research, an emerging star in the personal computer industry, is expected to announce today that retailing giant ComputerLand will become a dealer of AST products.
The announcement would be a major boost to AST's efforts to become a major seller of personal computers, a business that the Irvine electronics company entered just 18 months ago.
AST and ComputerLand, the world's largest computer retail chain, have scheduled a Silicon Valley press conference for this morning to make what they are calling a "significant announcement."
In anticipation of the briefing, AST's stock has gained nearly 20% since Friday in heavy trading. AST's stock closed Tuesday at $15.375, up 87.5 cents on the over-the-counter market, with 1.6 million shares changing hands.
"We expect the companies will jointly announce that ComputerLand franchises will carry the AST personal computer line," said Lawrence M. Harris, who follows AST for the Los Angeles investment firm of Bateman Eichler, Hill Richards.
Although several hundred ComputerLand stores already sell AST's personal computers, the agreement would mark the first time the retailer has agreed to carry the AST line at its 800 stores worldwide. ComputerLand also carries several other computer lines, including the products of two of the giants in personal computers, IBM Corp. and Compaq Computer.
Analysts called the ComputerLand accord a coup for the Irvine firm, which has been trying hard to sign up more dealers.
"It is difficult to get retail shelf space, because the retailers would prefer to carry as few product lines as possible," Harris said. Among the possible contenders for the ComputerLand business were Hewlett-Packard of Palo Alto and Wyse Technology of San Jose, he said.
AST claims to have sold 100,000 of its Premium/286 and Premium/386 models, which are compatible with IBM machines, in its first 15 months in the business--a strong showing for a new player.
A deal with ComputerLand "certainly will help AST, but they've done well already--much better than a lot of people expected," said M.C. Taylor, an analyst with Henry F. Swift & Co., a San Francisco investment firm.
AST has had a relationship with ComputerLand since 1982, when the Oakland-based computer chain began selling AST's line of computer add-on boards, which are used to add memory or enhance graphics on computers.