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Glove Corp (Results Review): 9MFY12
above expectations, valuations reflected in earnings (Upgrade from Sell to
HOLD, TP: RM4.62) [download
report]
9MFY12 net profit of RM138.7m (+59% y-o-y) came in above expectations at
105% and 84% of our and consensus full year estimates, respectively. The
variance from our forecast was due to higher-than-expected sales volume and
lower-than-expected raw material cost.
Correspondingly, we upgrade our FY12-FY13 net profit by 5-25%. Although our earnings forecast was proven
wrong but our SELL call was spot on as the stock fell 22% to RM4.10/share
before recovering to current level, but still 12% lower. We raise our target price from RM4.00 to
RM4.62 as we roll over our valuation to CY13 EPS based on 18x PER, in line with
its historical average. The stock is
currently trading close to our target price.
As such we upgrade our call from Sell to Hold.
Other reports
Other Malaysian news
§ Sime
Darby: To spend RM1.4bn on Weifang port
§ IHH:
Secures 22 cornerstone investors
§ Felda
Global: To raise RM10.4bn from IPO
§ UEM
Land
§ Axis
REIT: To buy Wisma
Academy
§ Kenanga:
Buys ECM Libra IB for RM875m
§ Ramunia:
Secures RM177.5m Sarawak Shell contracts
§ Scomi
Engineering: Unit shortlisted for India RM6bn rail job
§ Construction:
Transparency issues resurface
§
Plantation
Global news
§ US: Jobless claims climb to 386,000
§ US: Consumer prices fell in May by most
in three years
§ US: Current-account gap in widens to
highest level since 2008
§ US
§ Europe : Inflation slowed for second month in
May on energy
§ Europe : BOE combats euro ‘Black Cloud’ as
officials await Greek ballot
