PETALING JAYA: PublicInvest Research is optimistic over Wegmans Holdings Bhd’s acquisition of equity in Wison Screw Industries Sdn Bhd (WSI) as it provides better synergies and generate a new earnings stream.
“Based on our estimate, Wegmans could see an earnings uplift of 9%-20% in FY21-FY22 while earnings per share is expected to only increase by 3%-9%, given the dilution effect from new share issuance, ” it said in a note, while maintaining its “outperform” recommendation.
PublicInvest’s target price is left unchanged at 46 sen based on 15 times FY21 forecast earnings per share pending further approval on the acquisition, but will be adjusted correspondingly to 50 sen.
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