Genting HK: Macquarie says feedback from recent roadshow was positive, with investors more receptive now when the stock was initiated on a month ago, given greater investor awareness and more attractive valuations…
Nevertheless, notes that half of the investors (mix of long only and hedge funds) were still not aware of GENHK’s holdings in the Norwegian Cruise Line (NCL) in the US and/or in the Resorts World Manila (RWM) casino. Says investors were also positively surprised with the trading liquidity of the stock…
Indeed, a check of GENHK shareholder list indicates a lack of pedigree institutional following, unlike its more prominent sister, Genting SP. This means there is room for upside if the bigger boys start to pay more attention to this company…
Possible catalysts include: earnings growth at RWM, IPO of NCL in the US, possibility of new casino ventures in Sri Lanka or Japan, sale of 4 laid-up cruise ships to yield ~US$500m, increased analyst coverage.
Currently, only Macquarie (Outperform, TP US$0.60) and UOBK (Hold, TP US$0.40) cover the stock.
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