Company Name: NOBLE GROUP LIMITED
| Research House: CIMB | Price Call: BUY | Target Price: 1.42 |
Stock Name: Olam
Company Name: OLAM INTERNATIONAL LIMITED
| Research House: CIMB | Price Call: BUY | Target Price: 2.61 |
CIMB Research said it prefers commodity trading firm Noble Group to its peer Olam International due to its favourable earnings outlook.
Noble earlier this month posted a 46% fall in its first quarter net profit to US$110.1 million ($141 million).
Olam shares were up 0.9% to $1.70 on Friday, but have dropped 20% since the start of the year. Noble gained 1.4% to S$1.075, but has lost 4.4% in 2012.
The benchmark Straits Times Index gained 5% in the same period.
CIMB expects Noble's earnings to continue improving for the rest of the year, buoyed by its newly expanded sugar mills, which will contribute US$200 million more in annual earnings at full capacity.
Noble's earnings from its sugar business will also grow at a faster pace in the second to fourth quarter as the harvest season begins, CIMB said.
It has an outperform rating on Noble with a target price of $1.42, and an outperform on Olam and a target price of $2.61.
CIMB estimates Noble's core earnings per share to grow 81.8% for this year, compared to 14.5% for Olam.
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