Stock Name: CerebosPac
Company Name: CEREBOS PACIFIC LIMITED
CIMB in an Aug 3 research report says: "2Q11 net profit of $16.2 million (-19% y-o-y) forms 14% of our FY2011 estimate, with 1H11 net profit at 38% of our forecast. The main culprits were: (1) a product recall in Taiwan, Hong Kong, and Singapore; and (2) increasing raw-material costs.
"We believe the after-effects could persist in 2H11, though Cerebos's longer-term growth outlook should be unaffected. We cut our earnings estimates by 2-20% for FY2011-2012 to reflect lower sales and higher costs, which brings down our sum-of-the-part target price to $6.65 (from $7.30).
"Its historical dividends of 25 cents should be sustainable. Cerebos had been paying up to 90+% of its earnings in the past, and had net cash of $92 million at end-Jun 11. MAINTAIN OUTPERFORM."
Company Name: CEREBOS PACIFIC LIMITED
| Research House: CIMB | Price Call: BUY | Target Price: 6.65 |
CIMB in an Aug 3 research report says: "2Q11 net profit of $16.2 million (-19% y-o-y) forms 14% of our FY2011 estimate, with 1H11 net profit at 38% of our forecast. The main culprits were: (1) a product recall in Taiwan, Hong Kong, and Singapore; and (2) increasing raw-material costs.
"We believe the after-effects could persist in 2H11, though Cerebos's longer-term growth outlook should be unaffected. We cut our earnings estimates by 2-20% for FY2011-2012 to reflect lower sales and higher costs, which brings down our sum-of-the-part target price to $6.65 (from $7.30).
"Its historical dividends of 25 cents should be sustainable. Cerebos had been paying up to 90+% of its earnings in the past, and had net cash of $92 million at end-Jun 11. MAINTAIN OUTPERFORM."
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