Business

Brokers' take

Compiled by Claire Huang, The Business Times

CENTURION CORPORATION LIMITED | ACCUMULATE

TARGET PRICE: $0.42

MAR 3 CLOSE: $0.39

Phillip Securities Research, Mar 3

Fourth-quarter 2016 profit after tax and minority interests (Patmi) of $2.9 million missed our Q4 2016 estimate of $9.6 million by 70 per cent.

Surprise came from higher valuation losses from Westlite Toh Guan. Proposed a final dividend of S$0.01 per share, payable on May 19, 2017.

Downgrade to "Accumulate" from previous "Buy" rating with unchanged target price of $0.42.

CITIC ENVIROTECH | ADD

TARGET PRICE: $0.93

MAR 3 CLOSE: $0.785

CIMB Research, Mar 2

We raise our FY17-18F core earnings per share (EPS) estimates by 42-63 per cent, underpinned by a robust project pipeline and lower depreciation expenses, and introduce our FY19F numbers.

Our discounted cash flow (DCF)-based target price is now higher at $0.93 (7 per cent weighted average cost of capital), after adjusting for the 2:1 share split.

We think a stronger traction in project wins and improved trading liquidity could catalyse the stock, while key risk is rising industry competition that may erode IRRs (internal rate of returns).

Maintain our "add" call.

KIM HENG OFFSHORE & MARINE | HOLD

TARGET PRICE: $0.089

MAR 3 CLOSE: NA

OCBC Investment Research, Mar 3

Kim Heng Offshore & Marine recently reported a 45 per cent year-on-year fall in revenue to $7.5 million and a net loss of $13 million in Q4 2016, versus net loss of $1.5 million in Q4 2015, as earnings were dragged by asset impairments of $8.3 million.

Excluding this and other one-offs, we estimate full year core net loss to be $8.5 million, versus -$2.8 million in FY15.

There is a slight pick up in enquiries for the vessel chartering segment - as well as for maintenance services - but a more significant recovery in business activity may only be towards the later part of this year.

Meanwhile, the focus is on conserving cash and capex (capital expenditure) will drop significantly this year.

Maintain "hold" with fair value estimate of $0.089, based on 0.8 times FY17F book.

A 0.07 Singapore cent dividend has been declared, compared to 0.3 cent in FY15.

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