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NewsCIMB Research cuts MPI target price to RM4.21
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CIMB Research cuts MPI target price to RM4.21
by hlk Wed 17 Aug 2011, 18:39
KUALA LUMPUR: CIMB Equities Research said lower-than-expected margins were to blame for MALAYSIAN PACIFIC INDUSTRIES [] Bhd’s FY6/11 earnings shortfall of 18% relative to its forecast and 13% relative to consensus estimates.
It said on Wednesday, Aug 17 that as expected and in line with past practice, no dividend was declared for 4Q. The full-year DPS of 20 sen was in line with its estimate.
“But we slash our FY12-13 EPS forecasts by 18-21% after lowering our margin assumptions,” it said.
CIMB Research also cut its target price from RM5.09 to RM4.21 as it widened the discount to its five-year historical adjusted price-to-book value average of 0.7 times from 40% to 50% in view of the poorer outlook for the sector and MPI’s faltering earnings prospects.
“We reiterate our NEUTRAL stance given the lack of catalysts and vulnerability to lower volumes. Switch to JCY for exposure to the tech sector,” it said.
It said on Wednesday, Aug 17 that as expected and in line with past practice, no dividend was declared for 4Q. The full-year DPS of 20 sen was in line with its estimate.
“But we slash our FY12-13 EPS forecasts by 18-21% after lowering our margin assumptions,” it said.
CIMB Research also cut its target price from RM5.09 to RM4.21 as it widened the discount to its five-year historical adjusted price-to-book value average of 0.7 times from 40% to 50% in view of the poorer outlook for the sector and MPI’s faltering earnings prospects.
“We reiterate our NEUTRAL stance given the lack of catalysts and vulnerability to lower volumes. Switch to JCY for exposure to the tech sector,” it said.
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