Stock Name: PEC
Company Name: PEC LTD.
CIMB in a Nov 23 research report says: "Backed by net cash of 61 cents per share and net working capital of 55 cents per share, we see value emerging after its recent underperformance.
"PEC is only trading 11% above its net cash and 23% above its net working capital, implying an attractive risk-reward trade-off. We do not expect current net cash of $156 million to slip. We believe net cash can be sustained at $140 million-$160 million for FY2012-2014, even after factoring in some normalisation of working-capital management.
"It is the only stock trading at a 20% discount to book, even though its projected ROE could pass the COE hurdle rate. We cut our FY2012-2014 EPS by 4-27% as we dampen our margin expectations. Target price of 84 cents, still based on 1x CY12 P/BV. TRADING BUY."
Company Name: PEC LTD.
| Research House: CIMB | Price Call: TRADING BUY | Target Price: 0.84 |
CIMB in a Nov 23 research report says: "Backed by net cash of 61 cents per share and net working capital of 55 cents per share, we see value emerging after its recent underperformance.
"PEC is only trading 11% above its net cash and 23% above its net working capital, implying an attractive risk-reward trade-off. We do not expect current net cash of $156 million to slip. We believe net cash can be sustained at $140 million-$160 million for FY2012-2014, even after factoring in some normalisation of working-capital management.
"It is the only stock trading at a 20% discount to book, even though its projected ROE could pass the COE hurdle rate. We cut our FY2012-2014 EPS by 4-27% as we dampen our margin expectations. Target price of 84 cents, still based on 1x CY12 P/BV. TRADING BUY."
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