SGX-listed companies Yangzijiang Shipbuilding (SG:BS6) and AEM Holdings (SG:AWX) have been rated Buy by analysts. Both companies have more than 20% upside potential in their share prices.
After reporting their 2022 earnings, analysts have reconfirmed their Buy ratings with a bullish approach for 2023 numbers.
Let’s see what makes them the analysts’ favorites.
Yangzijiang Shipbuilding
Yangzijiang Shipbuilding is a group company engaged in shipbuilding and marine engineering services. The company also provides ship leasing, logistics, and real estate services.
The full-year earnings for 2022 led to a lot of positive action from analysts over the last month. The yearly profits of S$162 million did miss analysts’ expectations due to the higher losses incurred from non-performing investments. This was mainly due to high exposure from China’s real estate industry, which accounted for around 56% of the total non-performing portfolio.
Analysts Izabella Tan and Lim Siew Khee from CGS-CIMB re-rated the stock as Buy with an upside of more than 30%, considering the “worst could be over”. Tan believes “faster-than-expected AUM growth” and “improving real estate in China” are the next growth catalysts for the stock.
Yangzijiang Shipbuilding Share Price Target
According to TipRanks’ rating consensus, BS6 stock has a Strong Buy rating, with all five Buy recommendations.
The average share price target is S$1.64, which implies an upside of 32.2% on the current level.
AEM Holdings Limited
AEM manufactures and provides semiconductors and other electronic test solutions across Asia, Europe, and the U.S.
Last month, the company announced its 2022 annual results which made analysts confident about the stock. The company posted a 54% increase in its revenue of S$870 million exceeding its own guidance of between S$820 million and S$850 million. The numbers were driven by higher demand for its products and an influx of new customers. The profit before tax jumped by 43% year-over-year to S$158.7 million, which is the highest ever for the company.
CGS-CIMB analysts William Tng and Izabella Tan believe “a potential earnings recovery to happen for the company in the FY2024.” Despite a conservative revenue guidance of S$500 million, Tng and Tan are “fairly positive” about the company’s prospects. They also feel the higher legal and professional fees will decrease “significantly” in FY2023.
AEM Share Price Target
AWX stock has a Moderate Buy rating on TipRanks, based on four Buy, two Hold, and one Sell recommendations.
The target price of S$3.54, which is 20% higher than the current trading price.
Conclusion
Yangzijiang Shipbuilding stock has more than 30% upside growth in its share price and for AEM, the upside potential is around 20%.
