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Hi,
Comfort Delgro seems to be harbouring at $1.66-$1.68. Investors can consider picking this stock as part of bargain hunting list.
Hi hogoenterprise,
I can't see any strong trending from its TA charts. I think we will have clearer signals early next year when most people return from the holidays.
Citigroup Global Markets - Buy: Lowering Estimates and TP on Higher Cost Assumptions
Buy/Low Risk 1L
Price (22 Nov 07) S$1.78
Target price S$2.20
from S$2.32
Expected share price return 23.6%
Expected dividend yield 5.0%
Expected total return 28.6%
Market Cap S$3,709M
US$2,555M
Estimates lowered by 3-4% ? We trim our estimates for Comfort Delgro, building in higher energy costs assumptions and higher depreciation expenses as the group replaces more of its buses in Singapore. We trim our target price to S$2.20 on the back of the estimate changes, but retain our Buy (1L) rating.
Fuel costs are about 8% of total costs ? While the oil price has surged to near US$100 per barrel, fuel and energy costs are about 8% of total costs and therefore manageable. Every US$10/barrel rise in average fuel cost will trim our forecast earnings by 5%. We assume energy costs will rise 14% and 8% for 2008 and 2009 respectively compared to 9% and 5% previously.
Replacement of buses will boost depreciation expense ? With the accelerated replacement of its buses in Singapore, depreciation expense has increased sharply at SBS Transit. We build in higher depreciation expense as well as higher repair costs as well.
Overseas earnings continue to drive growth ? In spite of high energy costs and slow growth in Singapore, group earnings should continue to be driven by overseas operations including strong growth in Australia and China and steady performance from the UK.
Steady performer with strong balance sheet ? We maintain our Buy (1L) rating as the group trades below our sum-of-parts valuation of S$2.20, enjoys strong cashflows and attractive yields.
Repost.
CIMB - ComfortDelgro Corporation (S$1.85) - 3QFY07 results - A walk in the park
Within expectations. 3Q07 net profit of S$59.0m (+15% yoy) was within consensus and our expectations, with revenue growth driven by all its business segments, especially its overseas operations in the UK, China and Australia. 9M07 net profit was S$172.9m, up 12.0% yoy and was 73% of our FY07 forecast.
Operating expenses in 3Q07 were S$678.4m, up 5.3% yoy, attributable to higher staff costs, contract services, repair & maintenance, vehicle leasing charges and insurance & accident compensation. Materials & consumables declined 15% yoy to S$60.8m while taxi drivers? benefits fell 29.1% to S$16.6m. Energy costs rose modestly by 5.2% yoy to S$57.1m, aided mainly by fuel hedging. Operating profit grew 14.4% yoy to S$93.0m on the back of good financial management.
Bus segment continues to be boosted by overseas operations, turning in revenue growth of 10.6% yoy to S$401.3m in 3Q. Operating profit rose 12.6% yoy to S$41.0m, on writeback of provisions in the UK operations, and improved rates, increased charters and maiden contributions from recently acquired Toronto Bus Services. Singapore bus operations posted lower operating profit of S$8.1m due to higher repair & maintenance, depreciation, staff costs and higher GST. Turnover and operating-profit mix from overseas bus operations was 62.7% and 80.2% of group bus operations, respectively.
Taxi revenue grew 6.0% yoy to S$230.7m, mainly from Singapore and UK. However, operating profit was higher by 28.4% yoy to S$34.4m, on higher rental rates in Singapore and China, and maiden contributions from newly acquired Flightlink and Computer Cab.
Rail operations continued to support growth momentum, with an operating profit of S$2.3m, up from S$0.3m in 3QFY06, supported by higher average daily ridership for the North-East Line and Punggol and Sengkang LRT lines.
Other segments. Driving school and vehicle inspection and testing operations continued to post good revenue growth of 15.3% yoy, while automotive engineering, diesel sales and car rental operations remained relatively stable.
Maintain Outperform and target price of S$2.38. On our unchanged DCF valuation (WACC 8.0%, terminal growth 1%), our target price remains S$2.38. The stock should be well-supported by its attractive dividend yield of over 5%.
CIMB - ComfortDelgro Corporation (S$1.85) - 3QFY07 results - A walk in the park
Within expectations. 3Q07 net profit of S$59.0m (+15% yoy) was within consensus and our expectations, with revenue growth driven by all its business segments, especially its overseas operations in the UK, China and Australia. 9M07 net profit was S$172.9m, up 12.0% yoy and was 73% of our FY07 forecast.
Operating expenses in 3Q07 were S$678.4m, up 5.3% yoy, attributable to higher staff costs, contract services, repair & maintenance, vehicle leasing charges and insurance & accident compensation. Materials & consumables declined 15% yoy to S$60.8m while taxi drivers? benefits fell 29.1% to S$16.6m. Energy costs rose modestly by 5.2% yoy to S$57.1m, aided mainly by fuel hedging. Operating profit grew 14.4% yoy to S$93.0m on the back of good financial management.
Bus segment continues to be boosted by overseas operations, turning in revenue growth of 10.6% yoy to S$401.3m in 3Q. Operating profit rose 12.6% yoy to S$41.0m, on writeback of provisions in the UK operations, and improved rates, increased charters and maiden contributions from recently acquired Toronto Bus Services. Singapore bus operations posted lower operating profit of S$8.1m due to higher repair & maintenance, depreciation, staff costs and higher GST. Turnover and operating-profit mix from overseas bus operations was 62.7% and 80.2% of group bus operations, respectively.
Taxi revenue grew 6.0% yoy to S$230.7m, mainly from Singapore and UK. However, operating profit was higher by 28.4% yoy to S$34.4m, on higher rental rates in Singapore and China, and maiden contributions from newly acquired Flightlink and Computer Cab.
Rail operations continued to support growth momentum, with an operating profit of S$2.3m, up from S$0.3m in 3QFY06, supported by higher average daily ridership for the North-East Line and Punggol and Sengkang LRT lines.
KIM ENG - An elephant at home, A horse abroad
♦ Continued growth momentum from 1H07
ComfortDelgro (CD) 3Q07 results continued its growth momentum from 1H07. Year to date, revenue, operating profit and net profit had increased 7.9%, 11.2% and 12% respectively. Unsurprisingly, overseas operations continued to drive growth.
♦ An elephant at home, a horse abroad
While Singapore-derived revenue increased $34.8m (+3% Y/Y) in 9M07, overseas-derived revenue increased $126.2m (+14.1% Y/Y).Similarly, while Singapore-derived operating profit increased $4.7m (+3.4% Y/Y), overseas derived operating profit increased $21.1m (+22.4% Y/Y).
♦ Rail operations ? the domestic star performer
Domestically, rail operations was the star performer. 9M07 rail revenue increased 21%, tracking the increase in rail ridership of about 20%. Consequently, rail had reversed from an operating loss of $1.8m in 9M06 to a profit of $6.9m in 9M07.
♦ Domestic bus and taxi businesses outshine by rail
SBS Transit bus business continued to face cost pressure. Though revenue increased from higher ridership, 9M07 operating profit declined Y/Y from higher repair and maintenance, depreciation and staff costs. The situation should improve however, with increased ridership. Operating profit from domestic taxi business in 9M07 improved slightly, by $2.2m, as higher rental charged on the new Sonata fleet and more billings to corporate accounts offset an increase in taxi drivers? benefits.
♦ Overseas provide opportunities for organic and inorganic growth
CD?s businesses in its 3 main overseas markets: UK, China and Australiacontinued to flourish. Growth was perpetuated by organic business developments such as increasing taxi fleet size andcontract rate adjustments in the bus business and by recent acquisitions in all 3 countries.
♦ Target price reduced to $1.86, Maintain HOLD
We are maintaining our forecasts but have reduced our target price as sector valuation on the whole has declined. Valuing FY08 EPS at 15x PER,we obtained a fair value target price of $1.86. Maintain HOLD.
CITI - Buy: 3QFY07 Profits Rise 15% on Higher Overseas Contribution
Buy/Low Risk 1L
Price (13 Nov 07) S$1.85
Target price S$2.32
Expected share price return 25.4%
Expected dividend yield 4.8%
Expected total return 30.2%
Market Cap S$3,855M
US$2,653M
Within expectations as overseas contribution rises ? Comfort?s 3Q net profit of S$59m was in-line (9mths profit of S$173m forming 75% of full-year forecast) with higher overseas revenues fuelling growth. In spite of higher oil prices, the group has been able to manage with higher overseas revenues providing the cushion. Buy (1L) rating maintained as valuations remain undemanding.
Overseas contribution provides boost ? Overseas contribution formed 48% of revenues and 52% of operating profit. The UK and Australia bus operations grew strongly with operating profit rising 37% and 118% respectively.
SBS Transit saw 44% pullback in operating profits ? While revenues grew 2%, operating profit declined due to higher depreciation and repair and maintenance costs.
Singapore taxis see improvement ? Revenues improved with a younger taxi fleet and higher corporate billings while reduced taxi benefits also contributed.
NEL continued to operate profitably ?NEL contributed operating profits of S$2.3m on higher ridership although margins were affected by higher maintenance costs.
Forecasts maintained but watching oil price ? The group has been able to manage the impact of the oil price thanks to a weaker US$ and higher revenues from overseas bus operations. But the high oil price bears watching.
· Revenue rose by 6.3% to $771.4 million due to strong overseas contributions
o Overseas turnover accounted for close to 48% of total Group turnover, up from 44% previously
o Turnover from overseas bus operations now accounts for close to 63% of total bus turnover
o Turnover from overseas taxi operations now accounts for close to 39% of total taxi turnover
o Turnover from rail operations increased by 20% to $22.8 million due to strong ridership growth
· Overseas operating profit accounted for 52% of total Group operating profit Net profit increased by 15% to $59 million
Hi Dinghoki,
result will be out today after closing.
The 3Q result annnoucement will be released by today? Or has been released? Why suddently dropped so much? The result is not good? Anyone has info?
Not too sure if it's really that good. Lots of large block selldown as shown below ...
|
12:18:04 |
1.970 |
49,000 |
Sell Down |
|
12:16:01 |
1.980 |
1,000 |
Sell Down |
|
12:15:37 |
1.980 |
11,000 |
Sell Down |
|
12:04:06 |
1.980 |
19,000 |
Sell Down |
|
12:03:07 |
1.980 |
38,000 |
Buy Up |
|
12:03:02 |
1.980 |
62,000 |
Sell Down |
|
11:55:17 |
1.980 |
10,000 |
Sell Down |
|
11:35:53 |
1.980 |
65,000 |
Sell Down |
TA charts for Comfort now looking slightly better. Price has crossed the upper bollinger band and Acc/Dist and Chaikin are moving up. All good signs.
The bollinger bands are also pretty tight. A large price change may occur soon.