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CGS CIMB |
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Telecom Sector Re-setting expectations
• Assuming COVID-19’s impact lingers throughout 2020, we cut our earnings forecasts by 9-10% for Singtel and StarHub • Netlink is our top pick for earning resilience and ~5.8% yield. We also like Singtel for ~5.4% dividend yield, nearly +2 standard deviation (SD) of its mean and StarHub for 7% yield (near +1SD of its mean) • Key risk will be stocks dropping to our bear-case valuation leading to a potential loss of 10% to 15%.
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CSE Global Covid-19 and low crude oil prices; priced in
■ We think value in CSE is emerging as it now trades below its 2014-19 average 12M forward mean, and closer to trough of 7.9x P/E in Dec 2018. ■ Lower crude oil prices and capped activity levels warrant conservatism in our forecasts. But the c.36% share price plunge YTD has likely priced this in. ■ We think the risk-reward ratio is favourable at current levels. Reiterate Add, with a lower TP of S$0.45, now based on 11x CY21F EPS.
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| DBS VICKERS | DBS VICKERS |
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Singapore retail landlords In for a rough ride
• Suspension of Entertainment and Leisure businesses till end April-20 will impact overall retail scene • Retail landlords face operational uncertainties as malls cope with tighter measures (shorter operating hours and higher social distancing measures) or closures • Affected businesses may seek more help and rebates in our view • Sensitivity analysis: Our FY20F DPU estimates could drop by 4-13% (vs 2-4% previously) to factor in the impact of above measures
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ESR-REIT (EREIT SP) : BUY Enough Selling al-Ready!
• Interest expense savings from early refinancing; no refinancing in 2020 • Earnings relatively sheltered for now; retail tenants facing more challenges • Long-term goals still intact despite a pause in near-term inorganic growth plans
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Check out our compilation of Target Prices