Yongnam has announced yet another contract yesterday. Seems like they really do have lots of work to come, which means sometimes a stock decision can be made wrongly because we dont know what\'s around the corner in terms of announcement.:
Harlequin wrote:
Seems a tad too aggressive a target price of 46 cents by CIMB. For that, Yongnam has to win lots of big contracts in the next couple of months. As it is, the outstanding order book ain\'t hot to make me expect a major rise in revenue/profit for 2010. What do ya think?
Our FY10/11 EPS estimates are raised by 8% and 5% respectively,
as we hike our gross margin assumptions following this set of
results. Balance sheet strength also improved in 3Q as Yongnam
recorded strong operating cash flows and reduced gearing to 0.52x
from 0.61x at end-2Q10. Hence, we maintain our BUY call on the
stock at a slightly higher TP of S$0.47 (10x FY11 earnings).
This poor guy's share price has been fluctuated in a tight range S$0.20-0.30 since mid-2009.
Poor guy --= strong construction market leader but no stk market darling. Lucky i took profit a long time ago at 29 cents. Maybe can consider buying back...
Citi has initiated coverage --- may be a good sign. Target S$0.36 based on 8x FY12E earnings, a slight premium to YNM’s historical and peer average of ~7x.
Investment thesis is based on i) higher-than-expected earnings
growth (11% > FY12E consensus); ii) YNM’s strong market positioning amid a positive
industry trend; iii) compelling valuations (~6x FY12E P/E) and iv) downside protection
from replacement value of the group’s strutting assets (>70% of market cap). but improving
fundamentals could enable a sustained breakout to the upside.
UOBKH Yongnam Holdings – Strong construction demand will lift earnings BUY with 79% upside
(BUY/S$0.235/Target: S$0.42)
Re-iterate BUY on Yongnam Holdings (Yongnam) with a target price of S$0.42, pegged at the sector’s 9x 2012F PE. We expect its share price to remain resilient amid economic uncertainties, backed by a strong track record and a consistent dividend policy.
Yongnam’s share price remained stable in 4Q11 despite clinching two sets of contracts. This would present opportunities for investors looking to ride the regional infrastructure construction play story.
Yongnam will report its full-year earnings in February and we expect a net profit of S$63.5m, driven by stronger gross margin due to favourable project mix. The company has a policy of paying about 15% of earnings as dividends, which we project at 0.78 cents for 2011.
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