Lunner avatar
Rank sm
692
Posted by: Lunner 2.05 K
Expiry:
Target Price
$2.57
(+5.76%)
NOW:

Maintaining profit growth of 5% over last 3 FY
Despite stable revenue shows prudent cost management but partly from more cost effective contracting services.

Increase ridership will drive bus & rail core business growth if cost management on the latter is successful.

The other core taxi business is facing headwinds with limited 1-3% growth Y-o-Y and have taken learnings from uber/grab with better benefits to consumers. What remains if it can continue to adapt to remain competitive long run.

Overseas business remain flat and are affected by weaker exchange rates.

Nevertheless with 70% payout, 4% yield with potential upside on growth through cost management. $2.57 remains the target price in near future.

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Li_Guang_Sheng, dagger and Lunner like this.
Lunner :

One off Spike , sustainable momentum or further growth?

Sporeshare :

Price likely to be under pressure with so many attention on Grab, Uber and new operator for electric taxi. Rev likely to be affected.

Sporeshare :

Reply to @Lunner : yup! driver has more preference to choose which operator that will provide them the best and flexible way that suit their lifestyle.

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theintelligentinvestor :

Question is whether public transport can offset the expected lower in taxi, automotive engineering, inspection revenue? Challenging times ahead, CDG must focus on cost management and play offensive against Uber/Grab treat.

theintelligentinvestor :

Reply to @Lunner : Yes, hopefully Public Transport Services will be the saviour. Possible upside from BCM full year contribution, regulations for private car etc. Unlike SPH, CDG business is more defensive, bus, train, car inspection will be there for a long time.

Vested in CDG and Vicom.

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Salvatore avatar
Rank sm
2319
Posted by: Salvatore 47.2 K

With my divestment of $ComfortDelGro(C52) I have bought into $AEM(AWX) at a price of $2.75. :) Here is my brief coverage of this company.

I previously held this counter and released all I had at a price of $2.65. After a barrage of good news, I decided to enter the foray once again.

Throughout this entire coverage, I am assuming a profit margin of only 9%, which is a tad lower than their Q12017 profit margin of about 9.8%. Therefore, all my calculations here will be UNDERSTATED if they were to improve their profit margins, which has been the case over the last few years.

What I am also assuming is that there are no further sales order received from customers, which is almost zero probability.

Ready to read on? LETS GO!

"The Company is pleased to announce that it has received as at 31 May 2017, sales orders worth S$182 million for delivery in FY2017. This represents an increase of S$30 million in sales orders received over the previous sales order received announcement made on 18 April 2017."

With a profit margin of 9%, $182m of revenue equates to $16.38m of profit, which averages out to $5.46m per quarter. Adding q1 earnings, total year earnings will be 20.5 million, which equates to an EPS of $0.32.

With such an EPS, the share price of $2.72 represents a PE ratio of ONLY 8.6x. Everyone knows that this is an INSANELY low PE ratio, and that the market has not fully priced in the growth that is to come.

Even if it goes to an undemanding PE ratio of 12x, the price would have already grown to $3.8. I personally do not think that the management would allow the stock to escalate to that price, and they would issue bonus shares to improve the liquidity of the shares.

To give a comparison, $Micro-Mechanics(5DD) is trading at a PE ratio of 13x and $UMS(558) is trading at 17x (Info extracted from Stockfacts, correct me if I am wrong.)

What else do we want? It does not stop here! The company states - "Thirdly, with clear visibility of growth into the next few years, we intend to adopt a dividend policy to pay annual dividends, including interim dividends, of not less than 25% of profit after tax excluding non-recurring, one-off and exceptional items."

With a minimal profit estimation of AT LEAST $20million, 25% profit means $5m paid out, which equates to a dividend of at least 2.8% for an insane growth company.

To top it all of, institutional investors are buying in to AEM as well. "is pleased to announce that several long-only institutional funds have bought AEM shares and have become new shareholders. The institutional funds took up 2,737,800 shares at $2.70 a share from Orion Phoenix on 5 June 2017."

With this massive inflow of funds, I believe that AEM will attract many more institutional investors. I do not see Orion Phoenix reducing the percentage of their shares any further. With Institutional Investors buying at a price of $2.70, there is a major support there and I only see the price going up.

This is only the beginning of AEM!

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akwl88 avatar
Rank sm
2822
Posted by: akwl88 12.3 K

$ComfortDelGro(C52)

Q-ing 2.4 tmr

Ke yi ma?

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Salvatore avatar
Rank sm
2319
Posted by: Salvatore 5.22 K

Fully divested $ComfortDelGro(C52) today. As much as it is oversold, i dont see it making a comeback nor having much potential in the future. The future is about autonomous vehicles, AI, etc. With such old-fashioned management, decided to cut it at a bit of a loss. Onwards to better companies!

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