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CGS CIMB |
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CSE Global (CSE SP) Strong 1Q20 Results; Maintain BUY
Maintain BUY and P/E-based TP of SGD0.54, 10% upside and c.6% yield. CSE Global registered 56% and 23.1% revenue and PATMI growth YoY in 1Q20 to SGD131.8m and SGD7.1m. Growth was mainly due to the strong revenue flow from the Americas and Asia-Pacific region, as well as contribution from the Volta and RCS acquisitions. We remain cautiously optimistic on the company’ prospects but expect COVID-19 and low oil prices to have a negative impact to its business in 2Q20.
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Valuetronics Holdings Ltd Diversifying footprint in tough times
■ FY20 net profit of S$179m (-13.5% yoy) was slightly ahead of our/consensus expectations. DPS lowered to 20HKcts, implying 5.3% yield and 49% payout. ■ Trade tensions and accelerated supply chain shifts could weigh on FY21F. ■ Downgrade from Hold to Reduce on earnings cuts and few catalysts. VALUE continues to be cash-generative and has robust net cash of S$0.44/shr.
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UOB KAYHIAN |
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Valuetronics (VALUE SP) FY20: Results In Line But Challenging Outlook; Downgrade To SELL
FY20 net profit was in line, forming 102% of our expectation. While the capacity disruption from COVID-19 eased in Mar 20, a significant portion of VALUE’s customers in the US are relocating their production outside of China to minimise the impact from the US-China trade war. VALUE expects a significant drop in net profit for FY21. We cut our FY21 EPS by 29% to account for the loss of customers and slower demand, and slash our target price by 35% to S$0.55. Downgrade to SELL.
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Check out our compilation of Target Prices
