Friday, May 10, 2013

**** The Unstoppable: Ezion. Share price 2.26. (Trading Buy)

Ezion has broken up resistance level at 2.23 level. Momentum still looks as strong as ever as investors accumulate on any temporary dips. At this level, it is currently at an all time high again and looks good to head up further to test 2.40 level and find new high. A break above 2.30 can see more upside as long as 2.23 remains as new support level.
Stop loss at 2.18
Maybank KE - Ezion Holdings: Entering the High Growth Years; Buy TP $2.56 (10 May 2013)
EZI SP | Mkt Cap USD1.7b | ADTV USD12m
Ø  Maintain BUY on Ezion as we raise our valuation multiple to 15x FY13F PER (from 13x), TP SGD2.56. We believe that previous concerns on high gearing have mostly dissipated as Ezion demonstrates astute use of its capital.
Ø  1Q13 results were within expectations. Our forecast of 51% growth in FY13F EPS and a CAGR of 40% over FY13-15F remain well on track to be met. These high growth expectations are primarily backed by secured charter contracts limiting the risk of major misses.
Ø  We see sequential quarterly growth as more liftboat units are deployed. Net gearing has risen to 0.83x in 1Q13 and is expected to rise further in subsequent quarters.
CIMB Ezion Holdings - Cruise control (09/05)
At 24% of our FY13 forecast, 1Q13 results were actually above expectations, as stronger quarters are anticipated with five more liftboats/service rigs to be added through the year to its current 12. Catalysts could come from stronger-than-expected orders.  1Q core EPS was 20% above our expectation (11% above consensus) from higher gross margins and other income. We increase our FY13-15 core EPS by 3-8% to incorporate recent service-rig contracts, the divestment of its OMSA JV, contributions from marine supply bases and higher EBIT margins. Maintain Outperform with a higher target price following our EPS upgrade, still based on blended P/E and P/BV valuations. 

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