SG: Noble Group Ltd - 1Q12 earnings below consensus

Stock Name: Noble Grp
Company Name: NOBLE GROUP LIMITED

Research House: OCBC

Price Call: HOLD

Target Price: 1.21

NOBLE GROUP 11 May 2012

1Q12 EARNINGS BELOW CONSENSUS - Q12 below consensus -Slow margin recovery -Lower S$1.21 fair value Noble Group (Noble) reported 1Q12 revenue rising 14.1% YoY and 13.5% QoQ to US$22.8b - meeting 26.1% of our FY12 forecast. Net profit fell 45.8% YoY (down 1.3% QoQ) to US$110.1m, or 16.8% of our full-year estimate, versus the street's S$166m consensus; but if we strip out profit (loss) on supply chain assets, its recurring income was just down 9.8% YoY and up 35.2% QoQ at US$135.8m (20.7% of forecast). We are paring our FY12 revenue estimate by 1.1% and earnings by 12.1% to reflect potential economic headwinds around the globe. We are also easing back our valuation peg from 11.1x to 10.5x, which in turn reduces our fair value from S$1.46 to S$1.21. Maintain HOLD.