Amtek Engineering

Amtek Engineering: CS notes that there are signs of a bottoming in group's revenues: (1) The record tooling sales seen last year are finally driving revenue growth from new product launches; (2) Industry segments like enclosures, consumer and automotive should continue to see an improvement in revenue growth; (3) Amtek is seeing good traction in new segments such as Life Sciences; (4) Even in slower growing segments, Amtek is trying to boost revenue growth by winning new customers; To counter a difficult revenue growth environment, management have been focusing on better cost control. ie. higher automation levels to keep staff costs in control. This may lead to improving margins, providing a further boost to the bottom line when revenues recover. Currently, Amtek trades at 7x 12-month forward consensus P/E and 1.2x P/B. Valuations do not appear to be pricing in any growth or ROE improvements. A dividend yield of 6-7% also looks very defensive. A turn in the corporate capex cycle could drive a re-rating of the stock.