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3061-3080 of 3100
May be embarking on a short term downtrend now... suggest wait and see first
KE are raising their target price to $2.15 from $1.86 on the back of its recently announced order for its first FDPSO vessel for its subsidiary Cosco Shipyard Group (CSG). They believe that this deal is a major leap forward for Cosco as it demonstrates its growing capability to service the buoyant offshore oil and gas industry. In the past year, Cosco has been announcing a series of new contracts; they estimate that its project-based orderbook has ballooned from practically zero at the start of the year to about US$360m currently.
KE believe CSG is just one step short of being able to offer full turnkey rig construction. Management reckons that CSG will be able to offer new rig-builds in the near future as its workshop in Dalian will become operational by the end of the month. Besides lower labour costs, CSG may have a significant competitive edge if it is able to supply rigs to its customers faster than the current wait time of 30-36 months that stalwart yards such as SembCorp Marine and Keppel require. In the future, its mega Zhoushan shipyard will be CSG's main centre for offshore sector work, with enough capacity to handle up to 10 concurrent rig-builds by mid-2007 by their reckoning. They believe CSG's probable strategy is to source for rig-building contracts from Chinese national oil companies and leveraging off 30% shareholder SembCorp Marine's reputation before prospecting international customers.
Cosco's 15.2x FY07 PE looks attractive versus comparables such as SMM which trades at 19.4x FY07 PE (and against teir fair value multiple of 21x).
This counter is on a downtrend now.
Morgan Stanley says it has cut its rating to "equal-weight" from "overweight" because it believes the stock is not fairly valued, having risen 65% since the beginning of the year. Morgan Stanley said the stock was trading close to its fair value of $1.78, which it had raised from $1.65.
"Cosco Singapore's stock price has rallied sharply, significantly outperforming the Singapore market, mainly due to the company securing a US$120m contract to build the hull of a floating, drilling, production, storage and offloading vessel," Morgan Stanley said.
The stock has also benefitted from rising bulk freight rates, which bodes well for its fleet of bulk carriers, Morgan Stanley said.
Keep on with your good work of helpful postings. Thanks a million, even though not vested in all the counters u had highlighted. Cheers
We believe Cosco is poised for double-digit growth as it is well equipped to emerge as a strong player in the global ship-repair and offshore industry. Cosco's inherent cost advantage and its steady climb up the offshore learning curve should sustain its competitive edge and extend its growth potential," JP Morgan said in a note clients.
JP Morgan believes the market has not fully priced in the importance of Cosco's latest US$120m drillship hull contract for the US$620m floating, drilling, production, storage and offloading vessel of Norwegian MPF Corp, which it said "affirmed Cosco's engineering expertise and enhanced its credibility in the rigbuilding and conversion arena."
It rose after JP Morgan lifted its target price for the stock, to reflect the higher earnings from potential rigbuilding contracts. JP Morgan maintained its "overweight" rating on the stock, and raised its target price to $2 from $1.53.
Cosco's earnings momentum is also likely to be sustained through "lucrative single-to-double hull conversions," JP Morgan said in a client note on Wednesday.
"We believe Cosco is poised for double digit growth as it is well-equipped to emerge as a strong player in the global ship-repair and offshore industry," JP Morgan said.
Cosco's earnings momentum is also likely to be sustained through "lucrative single-to-double hull conversions," JP Morgan said in a client note on Wednesday.
"We believe Cosco is poised for double digit growth as it is well-equipped to emerge as a strong player in the global ship-repair and offshore industry," JP Morgan said.
This Cosco's price may be performing what Sembcorp Marine did 2 years ago. Consistent uptrend.
yes... as I mentioned before a few days ago, CoscoCorp has undergone a trend reversal to go upwards.
hmmm...P/E of 17....charts are pretty good...positive forecast news....worth considering....
CIMB-GK has raised its target price to $1.91.
"COSCO's offshore aspirations are well known and it is trying to build a reputation and track record. This contract is a decisive step into the offshore sector," CIMB-GK said.
CIMB-GK said it has raised its 2007-2008 earnings estimate for COSCO Singapore by 1-3%.
"Once COSCO manages to scale the learning curve in building jack-up rigs, it will have massive capacity on its side. This is likely to provide catalysts for the stock," it added.
DBSV has raised its target price to $1.90 as it believes the company's new US$120m contract to build the hull of a floating, drilling, processing, storage and offloading vessel (FDPSO) strengthen its earnings prospects.
"We expect the contract to reap operating margins of 15%, yielding profits of $25m, spread over 2007 and 2008," the brokerage said in a note.
It raised its earnings forecast for 2007 by 7% to $245.8m to factor in contributions from this contract, while keeping its "buy" rating on the stock.
"We expect the strong order book momentum to continue, and such contracts should account for one-third of its shipyard revenue by 2007, up from 23% in first quarter this year," DBSV said.
"With this contract in the bag and the strong likelihood of more orders [being] announced soon, our original assumption that COSCO would book $610m in conversion work over ... 2007-2008 now looks too conservative. We have raised our estimates to 550 mln sgd of project revenue in 2007 and $700m in 2008," UBS said in a note to clients.
UBS said its new price target for COSCO Singapore is justified by the earnings growth rate of 70% expected for its shipyard next year, it added.
UBS also said the restructuring of the shipping and shipyard assets held by COSCO Singapore's parent, China Ocean Shipping Group, will be another catalyst for the Singapore stock.
COSCO Singapore is widely expected to acquire more shipyard assets from its parent.
UBS has raised its price target to $1.89.
Cosco won a US $120 million (S$190 million) contract from Norway's MPF Corp to build the hull of a multi-purpose deep-water drilling ship. The vessel, which combines drilling, production and storage functions, will be the largest ship of its kind ever built (quoted from Today)
CoscoCorp now near 52 week high!
possible upward trend reversal?
Traders saw its transformation into a shipyard play as positive. There was also recent speculations that it would also secure a rig order.
There's speculation that it might move into rig-building.
worth a punt. but would be better when sign is more clear of the trend. now is grey to me.