Thursday, 12 July 2012

STOCKS NEWS SINGAPORE-Barclays favours Ezra, Keppel for next earnings

Barclays said it prefers oil and gas services firm Ezra

Holdings and Keppel Corp going into the next

results season as it sees earnings growth and potential

catalysts such as possible financing resolutions for Ezra and

further contract wins for Keppel.

Ezra is expected to deliver the highest year-on-year

earnings growth in the April-June period out of the oil services

and rig builders Barclays covers due to an increase in activity

in its subsea business and utilisation of its offshore support

segment, it said.

Barclays estimates Ezra's earnings per share in the third

quarter to jump 196 percent from a year ago, compared to

Keppel's 9 percent rise and Sembcorp Marine's 4

percent gain.

"The key focus of the upcoming results will likely be on the

operating margins...Ezra is expected to deliver sequentially

better margins, the Singapore rig-builders are also expected to

at least maintain their operating margins," said Barclays.

It has an 'overweight' rating on Ezra with a target price of

S$1.70.

Barclays said the recent pullback in Keppel and Sembcorp

Marine shares are an attractive entry point for investors. It

rates Keppel at 'equal weight' with a target price of S$13.30,

and Sembcorp Marine at 'overweight' with S$7.00 target price.

1236 (0436 GMT)

(Reporting by Charmian Kok in Singapore;

charmian.kok@thomsonreuters.com)

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DBS Vickers downgraded vegetable processing firm China

Minzhong Food Corp Ltd to 'hold' from 'buy' and cut

its target price to S$0.60 from S$1.45, citing cost challenges,

lower margins outlook and muted growth prospects.

By 0215 GMT, China Minzhong shares were 1.6 percent lower at

S$0.60 and have fallen about 26 percent so far this year,

compard to the FT ST China Index's 2.4 percent rise.

"The slower-than-expected flushing out of crops due to the

winter delay in FY12 and persistently higher costs are likely to

depress margins going forward," said DBS in a report.

It also noted that China Minzhong is now more focused on

expanding industrial farmland instead of agricultural farmland,

which means slower earnings growth as margins for processing

vegetables are much lower than for cultivating vegetables, said

DBS.

The brokerage said it expects China Minzhong's gross margins

to decline to 35.3 percent in 2014 from 38 percent this year.

1019 (0219 GMT)

(Reporting by Charmian Kok in Singapore;

charmian.kok@thomsonreuters.com)

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9:41 STOCKS NEWS SINGAPORE-IHH listing benefits ASEAN

healthcare stocks-CIMB

IHH Healthcare's planned $2 billion listing in Malaysia and

Singapore - the third largest initial public offering of the

year globally - has brought interest back into healthcare stocks

in Southeast Asia such as Singapore's Raffles Medical Group Ltd

, CIMB said in a report.

Shares of Raffles Medical were up 0.9 percent at S$2.36, and

have gained 11 percent so far this year, compared to the Thomson

Reuters Asia Pacific and Russia Healthcare Index's

5.6 percent rise.

"Recent news flow pertaining to the dual listing of

healthcare giant IHH Healthcare in Malaysia and Singapore has

certainly brought interest back," said CIMB, adding

company-specific news also helped.

Raffles Medical will benefit from hospital bed shortage in

Singapore, which has a lower bed ratio lower than other

developed countries at 2.22 beds per 1,000 people in 2010, CIMB

said. It has an 'outperform' rating on the stock with a target

price of S$2.69.

"With capacity constraints in public and other private

hospitals, patient loads at Raffles Medical's flagship Raffles

Hospital have been good," the brokerage said.

Raffles Medical is adding capacity at Raffles Hospital by

increasing clinical services and specialist offerings, at a time

when healthcare costs are rising.

Other healthcare stocks in the region include Thailand's

Bumrungrad Hospital, which has surged 71 percent this

year, and Malaysia's KPJ Healthcare, up 35 percent

this year.

To read a related story, click

(Reporting by Charmian Kok in Singapore;

charmian.kok@thomsonreuters.com)

Source: http://news.yahoo.com/stocks-news-singapore-barclays-favours-ezra-keppel-next-044633422--sector.html

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