Friday, January 14, 2011

Amtek is an attractive proposition for the coming correction

It is the worst feeling to have sold off your shares, and then see them continue to rise up in value. I have been experiencing this pain since the past few days. But, this is all part and parcel of investing/ trading. Nonetheless, I will not be going into the market any time soon, as it is already due for a correction. When the opportunity does come by again, Amtek will be one counter I will be looking at.

DBSV Research is initiating coverage on Amtek Engineering with a BUY call and target price of S$ 1.65, which offers 27% upside plus 5-6% dividend yield. Amtek is a pioneering metal stamper founded in Singapore in 1970. After a private equity
buyout in 2007, management quickly re-organised the business to move it further up the value chain and to improve the cross selling of higher value added products and services to existing and new customers. Amtek offers a faster earnings growth rate
of 59% CAGR from FY10-FY13F and is trading at only 8-9x FY11/12 PE, below the sector average of 10-11x.

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