ANALYSTS BULLISH ON SAPURA ENERGY
They see company’s future earnings potential and have ‘buy’ call on stock
SAPURA Energy Bhd shares are on a upside trend, riding on the stock’s future earnings potential and buoyed by strengthening crude oil prices.
Market analysts said Sapura Energy’s outlook was bright.
“Sapura Energy shares are a bargain right now and it is the best time for investors to accumulate the shares so that they can reap profits later when crude oil prices climb higher,” said an investment analyst at Employees Provident Fund.
Sapura Energy shares had risen to 35 sen from 31 sen over the past few weeks, driven by its solid RM16 billion order book as well higher oil prices.
The stock was most actively traded last Friday on Bursa Malaysia, with a total of 139.2 million shares changing hands.
The analyst said Sapura shares had been sizzling since the company made a RM4 billion cash call with Permodalan Nasional Bhd and partnered with Austria’s OMV AG.
“The two corporate exercises have alleviated the company’s debt troubles and the lower gearing will give it more room to push forward and secure new jobs.”
AmInvestment Research, which had a “buy” call on Sapura Energy, said its share price could soar to 38 sen in three to six weeks.
Meanwhile, JF Apex Securities has a higher target price of 50 sen on Sapura Energy because the firm has narrowed its losses.
“Going forward, Sapura is expected to clinch additional contracts of RM6 billion next year and another RM10.3 billion in 2021.
“We expect earnings to improve due to the gradual pick-up in global oil and gas capital expenditure spending,” said JF Apex in a note to investors.
It also has a “buy” recommendation on the stock.
AllianceDBS Research said Sapura Energy’s long-term outlook remained strong as its high order book pointed to a potential recovery. It has a 57 sen target price and a “buy” call on the stock.