Stocks in Focus on January 10, 2020: TASCO and NYT

Stocks in Focus on January 10, 2020: TASCO (Asia Wealth Securities TP at ฿32.00/share) and NYT (KGI Securities TP at ฿5.00/share).

Kaohoon Online has selected stocks with a potential of high growth for investors to consider on January 10, 2020.

 

Asia Wealth Securities (AWS) has given a “BUY” recommendation on Tipco Asphalt Public Company Limited (TASCO) with a target price at ฿32.00/share.

AWS states that TASCO will no longer be overhung if the 2020 budget for expenditures is passed through the House of Representatives on Agenda 2 with a total budget of Bt3.2tn after the draft of the mid-year budget of 2020, the amount of Bt518bn has passed the consideration of agenda 2 on 8 January 2020.

It is expected to have a positive impact on TASCO’s business, which its share price has dropped sharply since the beginning of the year, as crude oil prices rebounded, TASCO is currently oversold at the moment, crude oil prices have fallen to AWS’ expectation of USD60 +/- 2.

TASCO performance in 4Q19 was not bright, partly due to disbursement of the budget for the year 2020 is delayed by 4 months, but once it has been disbursed, it is expected that 1Q20 performance will return well. In addition, TASCO is expected to benefit from government spending to stimulate the economy of ASEAN countries. TASCO’s main income is from Thailand, Indonesia, Vietnam, Australia, and China.

 

KGI Securities (KGI) has given an “Outperform” rating on Namyong Terminal Public Company Limited (NYT) with a target price at ฿5.00/share.

KGI expects full-year 2019 car export volume to drop 7.0% YoY (1.06mn units) which is slightly higher than FTI’s forecast of 1mn units. KGI expects NYT to report 4Q19 earnings of Bt73mn (-19.1% YoY, -22.0% QoQ). The decline of YoY and QoQ would be due to declining export volume to Australia.

KGI cuts its 2019 and 2020 earnings forecasts by 4.4% and 4.7%. In this regard, KGI maintains a rating of Outperform with a 2020 target price of Bt5.00 based on DCF (WACC 8.4%, terminal growth 1%). The current share price provides an attractive dividend yield of 7.2% and 8.2% in 2019-2020. KGI also expects NYT to pay a special dividend of Bt0.15-0.19/sh. Including a special dividend, the 2019 dividend yield would be 11.1% – 12.2%.