Keppel Limited

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To balanced out the view. Here is analyst report with "BUY".

(not vested, but with a neutral rate on Keppel)

Keppel and Ezion get buy calls from OCBC

SINGAPORE (Dec 1): With oil prices remaining volatile, oil & gas companies with strong balance sheets to weather any downturns remain a favourite with OCBC Investment Research.

In a Dec 1 report, analyst Low Pei Han says investors should go for those with exposure to higher quality customers and a significant outstanding order book as these companies should also be more resilient. The house is recommending a ‘buy’ on Keppel Corporation ( Financial Dashboard) and Ezion Holdings ( Financial Dashboard) while maintaining ‘neutral’ in the overall sector.

OCBC says it had been relatively positive at the start of this year with an overweight rating on the broader oil and gas sector. The FTSE Oil and Gas index saw some volatility in Jan, but recovered in the subsequent months such that the index traded pretty much range-bound in the first eight months of the year.

However, since then, OCBC has downgraded the sector to Neutral on 2 Sep 2014, and the FTSE Oil and Gas index has lost about 20% of its value. At current levels, valuations are not demanding and the house does not see strong re-rating catalysts in the near term. Meantime, it does not see a significant oil price recovery till perhaps 2H15, which is when it sees the impact of production cuts.

Looking ahead, OCBC sees the risks are actually tilted more to the downside. For one, oil price volatility would affect the rate at which projects are being awarded, compounded by the renewed focus by international oil companies on shorter term shareholders’ returns. There is also the possibility of a credit crunch should the short-term outlook deteriorate.

In addition, there are several highly indebted companies in the industry, and it is imperative that they have a favourable debt maturity profile in view of rising interest rates and a likely subdued oil price environment, says the house. Those that are operating in segments of the industry with relatively high breakeven costs are more at risk, and should be monitored more closely.

Still, OCBC believes that the offshore sector has strong long-term fundamentals. But “equity investors are generally a jittery lot” so stepping into 2015, it would rather favour companies with strong balance sheets to weather any downturns. As such, investors keen to have an exposure to this sector may want to consider Keppel and Ezion with fair values of $9.89 and $2.04 respectively.

Keppel is down 3% at $8.73 while Ezion is down 11.7% at $1.17 as at 12:46 p.m. local time.
http://www.theedgemarkets.com/sg/article...calls-ocbc
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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I thought since we call ourselves value investors (VB) here, buy/sell calls by analysts are treated as nothing more than interesting opinions/tabloid spreads. The only value they bring is the occasional grunt work analysis done by the companies to simplify matters.

Up or down, hardly something to get excited over.
You can count on the greed of man for the next recession to happen.
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(01-12-2014, 01:55 PM)greengiraffe Wrote: I think this is a long and slow horror movie in the making based on my ancient experience...

Caveat Emptor
GG

(01-12-2014, 01:18 PM)corydorus Wrote: The MS report seems like after the fact. I thought all this already happens and well within expectation.
Clearly this drives related companies share price lower today.

hi GG,
Thanks for the posting of MS report. I concur with you - Act 1 has just started with (1) Transocean doing its customary write-downs and letting 1 JU option with Keppel expiring in Nov2014 (based on the MS report), (2) OPEC declaring no supply cuts late last week.

My general understanding is that most oil users have hedge their prices and it should be at least 1year before most of these users get to negotiate new (lower) prices and exert real pressure on the shale gas producers. Technology is not static and will be a wild card for both sides (i would bet my $ on the shale producers though since they had already surprised us). Finally, i suspect the recent OW Bunker fraud/bankruptcy saga indicates the start of the revealing of a list of folks who are currently swimming naked on either side.

Looking forward to Act 2.
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(01-12-2014, 03:53 PM)LionFlyer Wrote: I thought since we call ourselves value investors (VB) here, buy/sell calls by analysts are treated as nothing more than interesting opinions/tabloid spreads. The only value they bring is the occasional grunt work analysis done by the companies to simplify matters.

Up or down, hardly something to get excited over.

Yes, analysts' view should be treated similarly as other views. Focus on the facts, rather on the opinions. Big Grin
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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Hoping a greater discount in this stocks haha!
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(01-12-2014, 04:38 PM)I_love_girls Wrote: Hoping a greater discount in this stocks haha!

Cinema call it next change-Akan Datang in Bahasa.
WB:-

1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.

Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.

NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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Saya di rumah tunggu dan lihat
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wait.. wait... wait for near bottoming! Big Grin
1) Try NOT to LOSE money!
2) Do NOT SELL in BEAR, BUY-BUY-BUY! invest in managements/companies that does the same!
3) CASH in hand is KING in BEAR! 
4) In BULL, SELL-SELL-SELL! 
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(01-12-2014, 05:14 PM)brattzz Wrote: wait.. wait... wait for near bottoming! Big Grin


anybody can help suggest a bottom price to look out

I am (sorry for being so naïve) tired of analyst. I think they are professionals, have all the information at their finger-tips (unlike us) and etc. So far when I listen to them to buy, kena screwed, share price fall pretty soon. Exceptions are far and few in between

eg call buy since KC was 14+

abit shaken

thanks for listening
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(01-12-2014, 08:34 PM)davidoh Wrote:
(01-12-2014, 05:14 PM)brattzz Wrote: wait.. wait... wait for near bottoming! Big Grin


anybody can help suggest a bottom price to look out

I am (sorry for being so naïve) tired of analyst. I think they are professionals, have all the information at their finger-tips (unlike us) and etc. So far when I listen to them to buy, kena screwed, share price fall pretty soon. Exceptions are far and few in between

eg call buy since KC was 14+

abit shaken

thanks for listening

I think you are in a state of panick... you should learn from your lessons and start to read up on previous threads so that you are wiser from it.

We dunno much as well but by pooling our knowledge, I think we will be more united and better understand what we are investing in.

The spirit of this forum is to learn from each other and hopefully in time, we all grow together.

We are not brokers hence our feel is as good as that of the market.
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