Ezra Holdings: No change in fundamentals
The share price of Ezra Holdings has seen an astounding increase of
about 40% in the past week. Though Ezra has clarified earlier that it
was not aware nor has it been engaged on a takeover by Samsung Heavy
Industries, there could possibly be other offers by potential acquirers
along the way. Still, there has been no change to the company’s
fundamentals since its disappointing 3QFY13 results. Looking ahead, we
believe that execution risks are still not over for Ezra, despite an
order book of more than US$2b, as this is susceptible to project delays
and cost overruns. Without any official offer or significant contract
wins, the recent price gain appears overdone. Based on fundamentals, we
are retaining our fair value estimates of S$0.99, and at current price,
we downgrade our rating to SELL. (Low Pei Han)
For more information on the above, visit www.ocbcresearch.comfor the detailed report.
NEWS HEADLINES
- US stocks rose on Tue, with the S&P 500 index finishing above
1,700 for the first time since early Aug, after Microsoft hiked its
dividend and as Wall Street awaited the next day’s monetary-policy
decision from the Federal Reserve.
- Asiasons Capital breaks into Oil & Gas sector by acquiring 27.5%
stake of US-based Black Elk for S$218m. Acquisition will be funded by
the issuance of 194,642,712 new ordinary shares at S$1.1948 per share.
- Rex International Holding announced the acquisition of stakes in two
more licences in Norway, with total number of licences increases to 15
in four regions from initial 10 as at listing on 31 Jul.
- Parkway Life REIT announced that the acquisition of five Japanese
nursing home properties generates accretive net property yield of 7.0%.
- SingTel has beaten StarHub and M1 to the punch for new iPhone price plans.
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