KLCI Stock - GAMUDA / 5398 - 2010 Quarter 2

OSK Target Price: 2.75
My TP: 2.96+0.12=3.08 (PE 22, EPS 0.1344, DPS 0.12), 8.45% price increase from 2.84
My decison: NOT BUY (unless price < 2.7)
Reason: low ROE (<10), no major improve on revenue, high PE

My study based on 2010 Q1 report (number in '000):
- Compare to last year, the increase in profit before tax is due to higher contributions from all divisions
- Compare to preceding quarter, the higher profit before tax is mainly due to higher contributions from the construction division and the property division
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0336*4 = 0.1344, estimate PE on current price 2.84 = 20.24(DPS 0.12)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0311*4 = 0.1244, estimate highest/lowest PE = 22.83/19.77 (DPS 0.12)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0215*4 = 0.086, estimate highest/lowest PE = 38.02/30.81 (DPS 0.08)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0231*4 = 0.0924, estimate highest/lowest PE = 36.36/27.81 (DPS 0.08)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0244*4 = 0.0976, estimate highest/lowest PE = 28.59/19.26 (DPS 0.08)

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