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UOB Kay Hian re-initiates 'buy' on ST Engineering with TP of $4.60

Felicia Tan
Felicia Tan6/6/2022 10:46 AM GMT+08  • 4 min read
UOB Kay Hian re-initiates 'buy' on ST Engineering with TP of $4.60
In his report dated June 6, the analyst is positive on the counter’s prospects, as he sees it being a “fine balance” of defence and growth. Photo: Albert Chua/The Edge Singapore
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UOB Kay Hian has re-initiated coverage on Singapore Technologies Engineering (ST Engineering) with a “buy” recommendation and a target price of $4.60.

“Our target price implies 23.5x FY2023 P/E, or 1.3 standard deviation above its historical average. This is plausible as ST Engineering’s strong orderbook provides good visibility for growth in the medium term,” writes analyst Roy Chen.

“The target price translates to 11.1% upside (total return of 15.0% if including the 3.9% yield) over ST Engineering’s last close price of $4.14, which is at 21.1x FY2023 P/E, or 0.1 standard deviation below its historical average forward PE of 21.3x,” he adds.

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