CGS-CIMB Research is upgrading its call on Dairy Farm International (DFI) to “add” from “hold” but with a lower target price of US$4.50 from US$4.63 previously, as the stock is “back at palatable valuations”, especially for longer-term investors.

In a September 9 report, analyst Cezzane See says, “We stayed neutral post-DFI’s last results, on concerns of HK’s 2H20 prospects, but with its share price correcting by some 7% since our last report on July 30 (trending closer to its YTD trough share price of US$3.70) and forward valuations now at about 17.2 times FY21 P/E [closer to 1.5 standard deviation (SD) below its historical mean], we believe the near-term uncertainties are priced in.”

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