Sunny Side Up - ST Engineering, Popular Holdings (KIM ENG)

Stock Name: ST Engg
Company Name: SINGAPORE TECH ENGINEERING LTD

Research House: Kim Eng

Price Call: HOLD

Target Price: 3.15

Sunny Side Up - ST Engineering, Popular Holdings

What's cooking ST Engineering (STE SP, $2.89, HOLD, TP $3.15) - ST Engineering's share price has hit new one-year lows and is off by 13.5% year-to-date. While some recent negative news has had an impact, its earnings were relatively intact. Its current forecast dividend yield of 5.7% warrants a relook at the stock. However, we maintain our HOLD recommendation as its forward PER still stands at 15.7x. Our target price of $3.15 is unchanged, with upside of 9%. Hot stock Popular Holdings Limited (POP SP, $0.165, NOT RATED) - Popular is an established player in the book retailing and publishing business in the region. Its stock trades at 0.7x NTA and FY10 PER of just 3.6x against the peer average of 12x. The company has a strong net cash position of $0.11/share and a track record of stable and high dividend payout. Its small property development business may pay bumper dividends to shareholders within the next 3-4 years. Top news in bite-sized pieces OVERNIGHT… US stocks fell sharply Wednesday, taking their harshest beating in two weeks on a toxic combination of concern about Europe's debt crisis and data pointing to a slower economy recovery. The Dow closed down 179 points, or 1.5%. LOCAL… Lian Beng clinched contract valued at $128.8m. The new contract is for the construction of the 561-unit Waterfront Isle at Bedok Reservoir Road, a joint venture project between Frasers Centrepoint and Far East Organisation.