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Seen upward price momentum since results released last Fri. (21/9).
KKR is just one of the several buyers keen on Beyonics HDD. Even if KKR backout (nobody knows yet) there are several parties (Japan NIDEC especially) keen to buy Beyonics HDD business (rumour it's worth $300m, i.e. approx. 56c per share NOT including Beyonics other businesses). Personally, I'm vested 500 lots below 50c but do ur own homework.
Source: Lim & Tan Securities Daily Review, 24 September 2007
BEYONICS
Valuation Is Undemanding Relative To Takeover Valuation Of Peers
�� 4Q ended July 2007 net profit fell 7% yoy to $7.1mln (up 14% qoq) on the back of 15% yoy and 1% qoq decline in sales to $211mln, in line with expectations.
�� The weaker yoy comparison reflects the discontinuation of PBCA activities for Seagate,
decline in business volumes from Panasonic?s cordless phone business, foreign exchange losses and start up costs in their new factories in
�� Operating cash flow was about the same yoy at $29mln, while capital expenditure was $49mln, down from year ago?s $67mln.
�� Financial position is reasonable with cash of $68mln and shareholders funds of $289mln versus debts of $103mln, giving a gross gearing of 36%.
�� As the company is looking out for potential acquisitions, final dividend was reduced from 2.5 cents per share to 2 cents per share (44% payout ratio), giving a net yield of 4.5%.
�� At last friday?s briefing, management were up beat about prospects in their new financial year ending July 2008, citing market share gains from Brilliant (production hiccups after the acquisition by Nidec) in the base plate business, strong demand from Seagate (recently revised up their sales and profit guidance by 15-20%), absence of start up costs in
their
�� Production capacity is expected to increase by 25-30% yoy to cope with the strong demand, likely costing them $25mln.
�� Management also revealed at last friday?s meeting that they have been approached by several parties who are interested to buy their HDD operations, but discussions are still in the preliminary phase.
�� Management is comfortable with consensus net profit estimate of 20% growth this year to $30mln, giving a forward PE of 8x. This reflects higher demand from Seagate, market share gains, higher demand from Dell (battery pack business), absence of start up costs, stable raw material price and enlarged production capacity. As its peers (Brilliant and MMI) were taken over at PE of 12-13x, we are upgrading Beyonics to a BUY.
Hi Gurus I am holding some beyonics shares any idea is the KKR buy in still valid or it over.
This is a pretty good stock for trading play. Current price below NAV of 54cts.
Full year report just came in with Rev. down 16% but profit only down 2.6% @ 25.6M.
It gives good div. this year is 2cts/share, they usually give at year end. Not break in div. payment since 2002.
If you are looking for MA or buyout, with rumor here saying KKR buying. I think the odd is not good. As KKR is having trouble raising fund for other buyouts too. The recent dips may be a sign that buyout will not happen. (For what you know....maybe Monday...trading halt and buyout happen...heee).
KKR is current trying to raise a USD30b leverage buyout. And in US, all eyes on them if they are successful. A litmus test of some kind to see if risk appetite has return in the US.
For me, as I said is trading play, buy 29 sell 35. Buy 31 sell 37.5. Buy 35 sell 49 etc.....
With today report, PE stand at 9.3years. Not bad at all.
just my thought.
Charts seem to show this counter is bullish. Still appear to be undervalue. Good luck to those vested.
DBS Research believes that Beyonics provides a good fit for strategic buyers like Nidec because with the recent acquisition of MMI by KKR, its makes sense for Nidec to buy Beyonics? HDD division for a secured base plate supply to reinforce its Number 1 position in the HDD motor assembly business. As a takeover potential, DBS Research puts a fair value of $0.68 for Beyonics on a sum-of-parts valuation based on 2x P/BV for the HDD business.
Beyonics is currently trading at a steeper discount to its NAV of $0.526 compared to Global Test?s NAV of $0.258. Expect both stocks to trade at/above their respective NAV should M&A interest returns. From this angle, Beyonics is more attractive compared to Global Test.
Investors who wish to position into stocks with takeover potential should capitalize on the recent market sell-off and buy Beyonics. Technically, Beyonics has based out at $0.40 and should head for $0.47 to $0.49.
Is Seksun going to hijack the KKR deal here from Beyonics?
Seksun Corp. (SEK SP): The maker of metal components for the consumer electronics, computer and telecommunications industries said it
was in confident discussions about a ``possible transaction,'' without giving further details. The company was responding to a query by the
stock exchange after its shares surged as much as 16 percent. Seksun gained 7 Singapore cents, or 12 percent, to 65.5 cents at the close, its
biggest one-day jump since Feb. 26.
I'm also holding a couples of lots, at higher price than now.
It never worry me because source on the M&A is quite confident.
Well, this is a fair value based on their reported earning and performance.
If the rumours on M&A, with KKR and ridec fighting for Beyo, is true, then we are expecting the price of approx. $0.80.
Saw from another forum that "Reported KKR approached Seksun for TO today."
Read Spotlight on Beyonics by CIMB-GK (pg 5).
http://www.remisiers.org/research//Daybreak-210807[cimb].pdf
Support 1: 34.5c to 36c.
Support 2: 29.5c to 31c
Resistence1: 45c to 46c.
Resistence2: 55c to 57c.
Srong fundamental: NTA: 55c. PE 7x (Est FY31/7/07).
The sever sell down was last friday and during that time, every counters got affected.
After M&A, TP is around $0.8 ~ $1. Hence $0.51 is still a good catch if you M&A goes through.