I invested in STX OSV on a hunch 2 months ago as I felt this company has a lot of potential, especially since it is in the oil and gas sector. Just that it was unlucky to be listed when the markets were weakening. I was proven right when the share price has risen by close to 50% ever since. And, finally a research report to back my decision. Definitely one candidate I will look at during this correction.
DMG's report on 10 Jan:
Undervalued, under-researched leading OSV shipbuilder. STX OSV is one of
the leading global shipbuilder of offshore support vessels (OSV) with nine
shipyards in four countries. High oil prices are driving new orders for
high end offshore support vessels and in our view, STX is in a good
position to capture the returning demand for high-end platform supply
vessels (PSV) and offshore subsea and construction vessels (OSCV) given its
leading edge technology and strong market share in the high-end segments.
The company is set to register +18% core net profit CAGR over FY09-12F,
driven by improvement in project execution and healthy new order intake. We
initiate coverage with a BUY and TP of S$1.56, +30% upside from current
levels.
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