CGS-CIMB Research is keeping its “add” call on Penguin International with a target price of 55 cents, as the company is expected to survive this crisis to see revenues pick-up with crude oil prices, despite its latest 1H20 earnings being cut in half.

In an August 27 report, analyst Cezzane See says, “While we expect FY20 net profit to weaken due to lower stock sales and delays in deliveries, Pengiun’s 1H20 net cash position is a positive (net cash/share of 23 cents), while forward price-to-book valuations are undemanding at 0.48 times.”

For 1H20, Penguin reported a 26.2% y-o-y drop in revenue to $50.1 million on the back of fewer build-to-stock (BTS) vessels sold, leading to lower shipbuilding revenue and lower chartering revenue, while gross profit margin (GPM) was lower at 25.2%.

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