[ET Net News Agency, 31 March 2020] Nomura cut its target price for Nexteer Automotive
(01316) to HK$5.4 from HK$8.2 and maintained its "buy" rating.
The research house said Nexteer's FY2019 net profit of US$232mn was in line with
Nomura's estimate. The GM-UAW strike was a one-off disruptor and has weighed on 2H 2019
North America performance in terms of a US$121mn revenue loss.
Nomura highlighted two major positives from the results announcement, (1) a higher
payout ratio of 35% (from 20.5% in FY2018) that translates to a 7% dividend yield at
current valuation, and (2) an increase in the order backlog to US$26.4bn.
Nexteer's management projected a US$40-45mn decline in APAC revenue for 1Q as a result
of the COVID-19 outbreak in China. Nomura lowered its FY2020 GPM forecast to 14.6% (from
15.7%), leading to a 19% cut in FY2020 net profit. (KL)
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01316 NEXTEER
Nominal 
3.730 +0.050 (+1.359%) Others
31/03/2020 14:31
{I-bank focus}Nomura cuts Nexteer (01316) to HK$5.4; "buy"
| Remark: | Real time quote last updated: 23/04/2024 17:59 |
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