Source of opportunity
We view the recent 34% pull-back in Tat Hong’s (TAT) share price as an
attractive entry point. We think the multiple compression is overdone and
current level has more than reflected conceivable earnings concerns. We
see no change to its solid fundamentals and continue to like its defensive
business model and strong earnings visibility given exposure to the
resilient infrastructure and oil & gas sectors; growth prospects of recurring
net profit of TAT remain healthy at 74%/26% in FY08/09E. Its solid balance
sheet, attractive FCF yields and quality mgmt should also stand out in
current volatile markets. Upgrade to Buy from Neutral; new TP is S$2.80.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment