Stock Name: KingsmenC
Company Name: KINGSMEN CREATIVES LTD
Research House: OCBC
The house trims FY10 and FY11 estimates by 14% and 23%, respectively, to reflect a more cautious stance; “the group’s ambition of doubling its revenue in five years now appears stretched.”
Company Name: KINGSMEN CREATIVES LTD
Research House: OCBC
OCBC downgrades Kingsmen Creatives (5MZ.SG) to Hold from Buy “in view of its hazy near-term outlook.” The house cuts its fair value estimate to $0.65 from $0.82.
The house says Kingsmen has been growing exponentially since its listing, with earnings growth recording double-digit rates between 2003 and 2008; “we believe that this trend may reach a plateau in FY10-FY11, and are projecting a mild contraction in FY10 profits followed by flat earnings growth in FY11.”
The house says Kingsmen has been growing exponentially since its listing, with earnings growth recording double-digit rates between 2003 and 2008; “we believe that this trend may reach a plateau in FY10-FY11, and are projecting a mild contraction in FY10 profits followed by flat earnings growth in FY11.”
The house trims FY10 and FY11 estimates by 14% and 23%, respectively, to reflect a more cautious stance; “the group’s ambition of doubling its revenue in five years now appears stretched.”
It cites potential headwinds as a high-base effect after record high earnings in FY09, a gap in orderbook (with the bulk of revenues from Universal Studios Singapore already recognised) and arbitration proceedings against a sub-contractor.
However, the house adds, “beyond near-term headwinds, we remain sanguine over Kingsmen’s longer-term prospects...in addition, dividend yield is relatively attractive at around 6%.”
Shares are untraded at $0.570.
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