Business

Monday April 7, 2008

Stock Watch



HLB

BANKING stocks were not spared in the market sell-offs of the past month, but Citi analyst Julian Chua still likes the sector. In Citi's report on the banking industry, Hong Leong Bank was the banking counter with the highest potential upside at more than 26% based on its target price of RM7.46. Citi likes Hong Leong Bank for its defensive exposure to the consumer sector. Consumer loans account for more than 60% of Hong Leong’s loan book.

HLBANK : [Stock Watch] [News]

MAS

MALAYSIAN Airline System Bhd's (MAS) shares have been battered down over the last two weeks, but the counter remains a “buy” among all but one of the 13 analysts covering the stock recently. MIMB Investment Bank, in an update report, welcomed the airline's much-awaited fleet expansion with the order of 35 Boeing 737-800 aircraft and an option for 20 more. While there is an estimated booking fee of RM242mil in 2008 for the aircraft and the benefits of the fleet expansion can only be felt in 2011, the airline's earnings for the year are expected to continue to be strong. MIMB expected its net profit to grow 27% in this financial year ending Dec 31, 2008. “There is no change in our target price based on 12 times financial year 2008 price-earnings ratio. With a total return of 26%, MAS is a buy,” it said.

MAS : [Stock Watch] [News]

GAB

WITH the Malaysian equity markets facing volatility in the near and medium term, boutique research houses are beginning to recommend listed breweries that seem underpriced as defensive counters. At Friday's close of RM5.50, Guinness Anchor Bhd (GAB) was trading at an attractive price-earnings ratio of 13 times to Net Research's estimated financial year 2008 earnings per share of 41.2 sen. The research house has also estimated an attractive dividend yield of about 8%. “Backed by a solid earnings track record, we initiate our coverage of GAB with a buy call for its dominant position in the local market and defensive qualities,” Net Research said in a report.

GUINESS :  [Stock Watch]  [News]

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