broker's call

Things are looking up for O&M sector: UOB Kay Hian

SINGAPORE (Jan 21): The offshore and marine (O&M) sector is kept at “market weight” by UOB Kay Hian, as analysis by the research house on the global oil and gas (O&G) sector and the global rig market indicated that while there have been some positive developments, a new rig-building upcycle is some years away due to the excess supply of such assets.

In a Monday report, analyst Adrian Loh says, “Given recent order wins, we see the offshore wind sector presenting opportunities while the electric vehicle (EV) sector does not yet present a threat to oil demand.”

Japfa milking profits from higher average selling price in key segments

SINGAPORE (Jan 20): UOB Kay Hian is upgrading its call on agri-food company Japfa to “buy” from “hold” with a higher target price of 80 cents from 50 cents previously.

This is due to a significant rise in Japfa’s average selling price for its three key segments – swine, raw milk and broiler – since 4Q19.

Swine price in Vietnam has exceeded its five-year high due to the African Swine Fever (ASF) outbreak.

Latest acquisition expected to bring SPH REIT to new heights this year

SINGAPORE (Jan 13): Analysts are keeping their positive stance on SPH REIT following the REIT’s 1Q20 results announcement on Jan 10.

The REIT recorded a DPU of 1.38 cents, 3.0% higher than 1.34 cents in 1Q19. This came on the back of an 11.8% y-o-y increase in gross revenue to $60.1 million and a 12.4% y-o-y increase in net property income to $47.0 million.

Centurion Corp started at 'add' by CGS-CIMB on strong growth potential

SINGAPORE (Jan 8): CGS-CIMB Research is initiating coverage on Centurion Corporation, the provider of purpose-built worker accommodation (PBWA) and purpose-built student accommodation (PBSA), with an “add” recommendation and a target price of 61 cents.

As of 3Q19, the group has over 32 properties in six countries, which translates to around 64,956 beds. In FY18, PBWA contributed 67.1% of revenue and PBSA formed 31.4%.

CGS-CIMB likes this stock because it has consistently grown its bed capacity via developments and acquisitions.

Keep your eyes on these 3 property developer stocks this 2020: DBS

SINGAPORE (Jan 3): Property developers offer good value at 0.8x P/NAV (-1 standard deviation) in an environment of high valuations, according to DBS Group Research.

“With the property market expected to remain resilient and developers under our coverage have been actively clearing inventories in 2019, we see dissipating risks to their exposure to Singapore (SG) residential market which we estimate to drop to less than 15% of RNAV based on unsold inventories,” said lead analyst Derek Tan in a Thursday report.

Net interest margins to moderate earnings for banks in 2020: RHB

SINGAPORE (Dec 23): RHB Group Research is maintaining the three local banks -- DBS Group Holdings, UOB and Oversea-Chinese Banking Corp -- at “neutral” after their combined net profit is expected to come in flat y-o-y while net interest income (NII) growth is expected to be flattish too, given guidance from the banks of net interest margin (NIM) pressure and soft loan growth.

RHB expects resilient earnings for consumer and gaming sector in 2020 despite sluggish sales

SINGAPORE (Dec 23): RHB Group Research is staying “neutral” on the consumer and gaming sector and expects earnings in the sector to remain resilient in 2020.

However, slowing economic growth in the region, along with macro-economic uncertainties, could mean consumer spending will remain sluggish and limit the upside potential.

The Singapore government has predicted an economic growth of 0.5%-2.5% for Singapore in 2020.

Koufu primed for accelerated growth: SAC Capital

SINGAPORE (Dec 11): SAC Capital is initiating a “buy” recommendation on food court and coffeeshop manager Koufu with a target price of 87 cents.

In a Wednesday report, lead analyst Chow Zheng Jie says, “We like the strong ROE [return of equity], cash generative and defensive business model. And we expect more new outlets, new facility and overseas expansion will be the impetus for earnings growth.”

AEM started at 'buy' by DBS as demand for new technology picks up

SINGAPORE (Nov 29): Precision engineering services firm AEM Holdings is flying high. Year-to-date, its share price has more than doubled to close at $1.71 on Nov 28, climbing from 82.5 cents at the start of the year.

Yet, market watchers believe the counter is poised to soar even higher.

DBS Group Research is initiating coverage on AEM with a “buy” recommendation and a target price of $2.38, representing a potential upside of 39%.

Analysts keep up ravenous appetite for Jumbo

SINGAPORE (Nov 27): Analysts are still hungry for more of Jumbo even after the group's revenue came in flat at about $153.6 million in FY19 from $153.7 million in FY18.

Revenue from the group’s Singapore operations increased by $4.0 million on the back of two new Jumbo Seafood restaurants – a new Zui Yu Xuan Teochew Cuisine restaurant and a new Chao Ting Teochew Pao Fan outlet.

However, the increase was negated by a $4.1 million decline in revenue from its restaurants in China.

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