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CIMB Research maintains Overweight on Semiconductor sector, top pick MPI

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CIMB Research maintains Overweight on Semiconductor sector, top pick MPI Empty CIMB Research maintains Overweight on Semiconductor sector, top pick MPI

Post by Cals Tue 12 Aug 2014, 22:55

CIMB Research maintains Overweight on Semiconductor sector, top pick MPI
Business & Markets 2014
Written by theedgemalaysia.com   
Tuesday, 12 August 2014 09:41

KUALA LUMPUR (Aug 12): CIMB Research has maintained its Overweight rating on the Malaysian semiconductor sector and said it sees improving earnings visibility for MPI and Unisem.
In a note Aug 11, the research said it expects the companies to benefit from rising demand for mobile devices, powered by the Internet of Things (IOT) and stronger global economic recovery.
CIMB Research said MPI was its sector top pick due to its faster earnings delivery.
It added the sector trades at 15.3x CY15 P/E, which was still below its historical mean of 21x during the last recovery cycle in 2004-2010 period.
“Moreover, the sector trades at 1.4x CY15 P/BV, which is still below its historical mean of 1.5x, and also at a 15% discount to its Taiwanese OSAT peers.
“Therefore, we think the valuation is still compelling given that Malaysian semiconductor sector is still in the midst recovery process, which is supported by a strong 3-year CAGR of 136.6%,” it said
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