Ezra, market darling still

ocbc initiated coverage yesterday, aug 18 Multi-year growth with a 3-year CAGR of 78%. Ezra’s core net profits will likely triple in FY08 on the back of its new fleet and stellar associate contributions. Continued capacity expansion and favourable long-term charter rates should support multi-year growth and a 3-year earnings CAGR of 78%. • Initiate with Outperform; sum-of-the-parts target price of S$3.08. Ezra is trading at 11x CY09 core EPS, which is unjustified given the visibility and growth prospects of both its deepwater offshore support and construction and production businesses. Share-price catalysts could include new FPSO charters, offshore construction contracts and the successful delivery of deepwater vessels.

For more information on Ezra, one can check out their FY 2007 Annual Report as well as press releases and announcements over the months. Some brokers have written about EOC\'s bidding for a second FPSO contract, which so far seems to be proceeding smoothly. But don\'t place too much reliance on things such as target price; use independent thinking to assess the business prospects of a company based on your own reading and research. As they say, absorb the facts and figures, but translate them into meaningful knowledge on your own and internalize it.