Wednesday, July 13, 2016

ST Engineering

ST Engineering: Aerospace division secured orders of $770m in 2Q16, bringing its 1H16 orders to $1.2bn (1H15: $1.2bn).
- CIMB expects q/q improvements in 2Q16 earnings backed by stronger electronics and marine.
- The house maintains Add with higher target price of $3.60, now pegging to higher P/E of 22x from 20x on the back of seady earnings backed by orders.
- The house likes STE for its net cash, decent dividend yield, and high ROE vs. other industrial names in Singapore that are facing headwinds in offshore orders.

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