Stock Name: Yangzijiang
Company Name: YANGZIJIANG SHIPBLDG HLDGS LTD
AmFraser Research in a Sept 26 research report says: "We believe that YZJ reached a significant milestone when it won the Seaspan order over South Korean yards-while bidding 5% higher. This fundamental shift in the competitive landscape has yet to be priced in.
"In our opinion, the stock price has already taken into consideration the weak demand expectations and general fears about S-chip corporate governance. Put bluntly, not every S-chip is a bad egg. Over time, these fears should recede and allow for revaluation.
"We apply a forward P/E of 8x on 2011F EPS of 20c, arriving at a fair value of $1.600 for a 12-month target. YZJ has a good chance of doubling (and then more) in the medium term. Once we include the 6% dividends annually, the 3-year compounded return is 30+%. BUY (initiating coverage)."
Company Name: YANGZIJIANG SHIPBLDG HLDGS LTD
| Research House: AmFraser | Price Call: BUY | Target Price: 1.60 |
AmFraser Research in a Sept 26 research report says: "We believe that YZJ reached a significant milestone when it won the Seaspan order over South Korean yards-while bidding 5% higher. This fundamental shift in the competitive landscape has yet to be priced in.
"In our opinion, the stock price has already taken into consideration the weak demand expectations and general fears about S-chip corporate governance. Put bluntly, not every S-chip is a bad egg. Over time, these fears should recede and allow for revaluation.
"We apply a forward P/E of 8x on 2011F EPS of 20c, arriving at a fair value of $1.600 for a 12-month target. YZJ has a good chance of doubling (and then more) in the medium term. Once we include the 6% dividends annually, the 3-year compounded return is 30+%. BUY (initiating coverage)."
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