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http://www.theedgemarkets.com/my ... ys-cimb-ib-research
Vivocom 1Q16 net profit smashed expectations, says CIMB IB Research
By theedgemarkets.com / theedgemarkets.com | May 13, 2016 : 9:47 AM MYT
KUALA LUMPUR (May 13): CIMB IB Research has maintained its “Add” rating on Vivocom International Holdings Bhd at 36 sen with a higher target price of 78 sen (from 67 sen) and said Vivocom’s annualised 1Q16 net profit smashed house expectations by coming in 76% above our previous full-year forecast.
In a note May 12, the research house said Vivocom’s margins were boosted by the final certification of works on several building jobs.
“We raise our FY16F EPS by 31% but maintain FY17-18 EPS.
“Maintain Add with a higher SOP-based target price of 78 sen, with construction earnings valued at 10.5x, 30% discount to the sector P/E of 15x.
“Potential re-rating catalysts are continued flow of new contracts and potential bonus issue,” it said.
At 9.31am, Vivocom topped the actives list and fell 2.78% or 1 sen to 35 sen with 74.53 million shares done.
Unfortunate timing today
Msci rebalancing Maybank and Cimb weighting got reduced so index got whacked.
Profit taking after news was expected. Yesterday and today's sell down have chased out quite a bit of speculators, the price should stabilize at current level and our concern now is the overall market sentiment
Hot Stock
Vivocom dips 2.7% in line with broader market retreat
By Sangeetha Amarthalingam / theedgemarkets.com | May 13, 2016 : 11:38 AM MYT
KUALA LUMPUR (May 13): Vivocom International Holdings Bhd dropped 2.78%, falling in line with the sudden fall in Bursa Malaysia, which slumped 24.38 points to 1,624.6 points in early trade.
The stock, which has gained 27.27% year-to-date, dipped one sen to 35 sen with 95.2 million shares done for a market capitalisation of RM931.4 million. Over the week, it has been the top active counter.
Its sudden dip in share price surprised CIMB IB Bhd analyst Marcus Chan who expected Vivocom to continue its uptrend, following its outstanding first quarter ended March 31, 2016 (1QFY16) results.
He opined it could be a result of the overall Malaysian stock market’s performance that has taken a hit with banking and oil and gas related shares falling.
“I am surprised, because I expected it to do well today, because of their outstanding earnings. I believe Vivocom would do better next week, as it expects a RM700 million contract coming up. It should recover,” he told theedgemarkets.com
In a note today, Chan said CIMB raised Vivocom’s earnings per share by 31% to impute higher gross margin, given its strong 1QFY16 results.
Target price was raised to 78 sen, with an unchanged “add” call, he said.
Yesterday (May 12), Vivocom posted a 27 times higher net profit for 1QFY16 at RM25.12 million, from RM923,000 a year ago, driven by the group’s construction business.
Earnings per share rose to 0.81 sen, from 0.09 sen last year.
Its revenue for 1QFY16 also rocketed 20 times to RM141.54 million, from RM7.04 million.
Vivocom said the construction segment contributed 88.9% or 125.81 million to the group’s total revenue under the quarter under review, while its manufacturing division contributed 5.7%, with the remaining 5.4% coming from its telecommunication towers business. |
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