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RHB turns positive on Dairy Farm's valuations after selldown

Michelle Zhu
Michelle Zhu3/20/2019 11:12 AM GMT+08  • 2 min read
RHB turns positive on Dairy Farm's valuations after selldown
SINGAPORE (Mar 20): RHB Research is upgrading its call on Dairy Farm from “neutral” to “buy” despite lowering its target price to US$8.25 from US$8.64 previously with the view that long-term investors may look to accumulate the stock at its curren
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SINGAPORE (Mar 20): RHB Research is upgrading its call on Dairy Farm from “neutral” to “buy” despite lowering its target price to US$8.25 from US$8.64 previously with the view that long-term investors may look to accumulate the stock at its current low.

The research house’s move comes on the belief that Dairy Farm’s share price has hit its trough after plunging 19% in the year to date (YTD), underperforming the Straits Times Index (STI) considerably after the company made major write-downs and provisions to its supermarket/hypermarket division in 4Q18.

In a Wednesday report, analyst Juliana Cai says she deems Dairy Farm’s current valuations “interesting”, now that the stock is trading at a discount to its peer average of 23 times at 20 times P/E.

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