Stock Name: Nordic
Company Name: NORDIC GROUP LIMITED
AmFraser Research in a June 20 research report says: "Nordic is in the business of automating ship control systems. Nordic recently bought Multiheight Scaffolding (MHS), an onshore oil-and-gas play with bigger margins and even bigger net profits than Nordic itself, paving the way for a quantum leap in earnings.
"While the acquisition will bring a significant boost to Nordic's EPS, its share price has in fact fallen with the general market, giving us greater confidence that this is an unnoticed gem. We value the enlarged Nordic Group using a DCF approach, thus avoiding the impairment loss problem (which is non-cash in nature).
"Our key assumptions include: (i) Risk free rate of 2.27%; (ii) Equity risk premium of 8.63%, (iii) Adjusted beta of 1.66; (iv) Zero growth for 7 years beyond forecast horizon; and (v) 3% terminal growth rate. We arrive at a fair value of 26 cents (upside: +63%). BUY (initiating coverage)."
Company Name: NORDIC GROUP LIMITED
| Research House: AmFraser | Price Call: BUY | Target Price: 0.26 |
AmFraser Research in a June 20 research report says: "Nordic is in the business of automating ship control systems. Nordic recently bought Multiheight Scaffolding (MHS), an onshore oil-and-gas play with bigger margins and even bigger net profits than Nordic itself, paving the way for a quantum leap in earnings.
"While the acquisition will bring a significant boost to Nordic's EPS, its share price has in fact fallen with the general market, giving us greater confidence that this is an unnoticed gem. We value the enlarged Nordic Group using a DCF approach, thus avoiding the impairment loss problem (which is non-cash in nature).
"Our key assumptions include: (i) Risk free rate of 2.27%; (ii) Equity risk premium of 8.63%, (iii) Adjusted beta of 1.66; (iv) Zero growth for 7 years beyond forecast horizon; and (v) 3% terminal growth rate. We arrive at a fair value of 26 cents (upside: +63%). BUY (initiating coverage)."
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