Company Name: STX OSV HOLDINGS LIMITED
| Research House: Citigroup | Price Call: BUY | Target Price: 1.70 |
Citigroup cut its target price on STX OSV Holdings to $1.70 from $1.95 and kept its ’buy’ rating, citing lower margin and muted growth expectations over the next two years.
By 12:12 p.m., STX OSV shares were down 1.1% at $1.36, and have gained 17% since the start of the year, compared with the FTSE ST Oil & Gas Index’s 18% rise.
Concerns over the pace of STX OSV’s order wins and margin pressure are likely to weigh on its shares in the near term, Citi said.
However, the brokerage sees an attractive opportunity to buy STX OSV shares due to the recent fall in share price after its third-quarter earnings.
“We believe investors may have taken an overly bearish view and that risks have most likely been mispriced,” said Citi, adding that the decline in third-quarter sales was due mainly to lumpy revenue recognition.
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