Ezra: RBS maintain Buy with TP $2.00. Note that share price has over-corrected on its 3Q earnings miss and will recover on the back of future contract wins and subsequent earnings recovery. Subsea (AMC) profits to improve, with at least US$600m worth of new contracts.
Tip core offshore support earnings to grow at a steady 9-10% on vessel adds
Earnings lowered to reflect 9M11 and management guidance. Stock appears undervalued at CY12F PE of 8x, given its FY12F 91% yoy and FY13F 21% yoy earnings growth.