Stock Name: ComfortDelGro
Company Name: COMFORTDELGRO CORPORATION LTD
Research House: Nomura
Nomura Research in a May 16 research report says: "CD reported a 7.7% y-o-y decline in 1Q11 profit to $50.1 million, below our and market estimates of $56 million and $58 million, on lower earnings in the bus and automotive engineering divisions while taxi and rail posted relatively robust growth.
"CD's land transport operations are likely to continue to be impacted by higher inflationary pressures, with higher fuel and labour costs as well as volatile currency-translation effects likely to impact earnings. However, its robust balance sheet and the strong cash generative aspects of its multinational bus, taxi and other land transport related businesses should continue to sustain profitability.
"CD now trades at FY11/12F P/E of 12x and 11x, at the lower end of its historical P/E band of 10x and 20x, while the dividend yield remains attractive at 4%. Target price of $1.98. BUY"
Company Name: COMFORTDELGRO CORPORATION LTD
Research House: Nomura
Nomura Research in a May 16 research report says: "CD reported a 7.7% y-o-y decline in 1Q11 profit to $50.1 million, below our and market estimates of $56 million and $58 million, on lower earnings in the bus and automotive engineering divisions while taxi and rail posted relatively robust growth.
"CD's land transport operations are likely to continue to be impacted by higher inflationary pressures, with higher fuel and labour costs as well as volatile currency-translation effects likely to impact earnings. However, its robust balance sheet and the strong cash generative aspects of its multinational bus, taxi and other land transport related businesses should continue to sustain profitability.
"CD now trades at FY11/12F P/E of 12x and 11x, at the lower end of its historical P/E band of 10x and 20x, while the dividend yield remains attractive at 4%. Target price of $1.98. BUY"
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