SINGAPORE (Feb 26): CGS-CIMB Research continues to remain optimistic on Penguin International’s earnings ahead, following the latter’s positive set of results in FY19 ended Dec 31.
The brokerage raised its earnings per share (EPS) forecasts for FY20 and FY21 by 6.97% and 7.28%, respectively, on the back of higher shipbuilding revenue.
It also forecasts the builder and operator of high-speed aluminium ships to register EPS growth of 4% in FY22.
CGS-CIMB believes the builder and operator of high-speed aluminium ships may look to increase build-to-stock (BTS) sales this year.
According to CGS-CIMB, Penguin International sees continued demand for its crew transfer vessels for offshore wind, armoured security vessels for maritime protection, crewboats for oil and gas personnel transfers, and passenger ferries for tourism and public transport.
The company is also continuing its fleet renewal programme and adding new crewboats to its operating fleet as it sees a pick-up in chartering activities, the brokerage notes.
“We like [Penguin International] as it is increasingly profitable, cheap versus domestic peers and still in a net cash position (which will accord it dry powder to shore up its build-to-stock inventory),” CGS-CIMB analyst Cezzane See writes in a note dated Feb 25.
CGS-CIMB has maintained its “add” rating for the stock with a higher target price of 82 cents from 81 cents previously.
As at 10.51 am, Penguin International was down 2 cents or 2.8% at 69 cents, with some 378,200 shares changed hands.
