NOBLE: "Take a contrarian view, accumulate stock..." says DBS Vickers

Excerpts from DBS Vickers' report

ICEBERG HAS posted a series of questions on its website for Noble’s AGM today. Nothing new, the questions posed by Iceberg are a restatement of its allegations in its previous 3 reports.

Meanwhile, in a filing with SGX, Noble Group reassures that liquidity headroom of $5.1b is “more than enough” to cover total debt outstanding and targets 35% payout ratio. Our analyst keeps his HOLD rating on the stock.

Stock price (17 Apr 2015)	89.5 cents
52-week range	82.5 cents – $1.4335
PE (ttm)	19.6
Estimated P/E (12/2015)	8.0
Market cap	S$5.93 billion
Price/book	0.96
Dividend yield Bloomberg data	1.1%

On the charts, Noble Group shares have held above the c.85cts level despite the 3 Iceberg and single Muddy Waters reports that attacked on similar issues.

This suggests price resilience at $0.85 and further signs of a trough.

The stock’s volume and price action in the past 1-2 weeks also indicate likely price stabilization and basing pattern in formation.

We note that substantial shareholder Prudential has raised its stake in Noble Group by 19.2mil shares (from 5.0188% to 6.1055%) at average price of $0.882 in the past 1 month.

From a trading perspective, we take a contrarian view and advocate investors to accumulate the stock at current level, above $0.85.

NOBLE: "Take a contrarian view, accumulate stock..." says DBS Vickers

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