Starburst

Starburst: CIMB has a non-rated note, citing 1H14’s profit has already exceeded FY13’s, on the back of contract wins, which will carry on to CY15. . The secured orders will allow Starburst to recognize another $17m revenue for 2H14. Actual revenues are likely higher as there is a maintenance element from previous contracts. Nevertheless, the key isn’t current contracts but what is up for grabs. CIMB says Starburst is expecting 10 contracts over the next 2-3 years, worth ~$100m, Also, with actual contract sizes tripling, the initial guide could be breached. Potential work in Saudi Arabia could also be a great potential, after it build its office in Middle East. At a range of 7.6x – 10.1x CY15 P/E, CIMB estimates Starburst to be $0.87-$1.16