PEC falls on weak earnings

Stock Name: PEC
Company Name: PEC LTD.

Research House: CIMB

Price Call: HOLD

Target Price: 0.93

Shares of Singapore oil and gas services firm PEC Ltd (PECL.SI) fell as much as 9% on Thursday to a one-year low after the company reported weak quarterly earnings.

At 10:53 a.m., PEC shares were down 7.3% at $0.83 with 2.8 million shares changing hands. This was nearly five times its average daily volume over the last five sessions.

PEC said on Wednesday its net profit fell 64% in the fourth quarter to $3.5 million, hurt by a drop in sales and losses from joint ventures.

CIMB Research downgraded the stock to neutral from outperform and cut its target price to $0.93 from $1.58, citing weaker-than-expected earnings due to losses from associates.

The brokerage also lowered its earnings estimates for PEC for fiscal 2012-2013 by 25-28%.