The drop in global air traffic will negatively impact ST Engineering’s earnings. RHB has trimmed its 2020-2022 estimates 4-8% on a weak revenue outlook for aviation maintenance, repairs and operations (MRO) and lowered its target price to $4.65 from $4.90.
SINGAPORE (Apr 20): Despite unprecedented shocks to the global aviation industry, RHB Research has reiterated its “buy” call on top pick ST Engineering on the back of aggressive government support and its classification as an “essential service”.
“ST Engineering remains our Top Pick, given its relatively resilient and well-diversified business portfolio that offers strong revenue visibility from a record-high orderbook and earnings contributions from recently completed acquisitions,” said RHB analyst Shekhar Jaiswal.
