CWT

CWT: KE has a Buy call with $1.25 target, pegged to 18x core FY10 PE. We think that CWT is currently undervalued. Taking into account the Cache Reit transactions, we estimate CWT’s BVPS at $1.01, and net cash/sh of $0.51, vs last traded at $0.915. On the back of its huge cash war chest, catalysts include prospect of special dividend payout, and announcement of earnings-accretive M&A.