Perisai kicks off its move into the drilling segment with the award of a construction contract for a jack-up rig and an option on another. Each rig could boost net profit by RM40m p.a. effective 2H14, allowing the company to enjoy yearly record net profits at least until FY16.
Even without the new rigs, FY12-14 are already shaping up to be record years for Perisai. We continue to value the stock at our CY13 target market P/E of 13x. Perisai remains an Outperform and our top small-cap oil & gas pick. This announcement could be a significant re-rating catalyst as the market has been anticipating new assets.
What You Should Do Accumulate the stock aggressively. Imputing just the existing assets, we
forecast a 3-year EPS CAGR of 99.6%, way above the sector average of 20.3%. Yet, the stock offers the most share price upside in our oil & gas portfolio and the cheapest FY12-14x P/Es of 7-9x.
(Analysis: At the time of writing, price has broken through the squeeze formed by Bollinger Bands and traded at 0.925. The breakthrough is a sign of price reversal. - Smartbiz)
1 comment:
The market analysis shows that market will take some for improvement and you can make profit by investing this time.
Post a Comment