KUALA LUMPUR (July 30): AffinHwang Capital Research has maintained its “Sell” rating on UMW Oil & Gas Corporation Bhd at RM1.39 and cut its target price to RM1.10 (from RM1.60) and said regional jack-up day rates fell further in 2Q15, and now hover around US$110,000-120,000 (down 20-30% year-on-year).
In a note today, the research house said lower charter rates and UMW-OG’s untimely contract renewal schedule should hit earnings, leading it to cut its 2015-17E EPS by 41-49%.
“We reaffirm our Sell and cut our target price to RM1.10, now based on PBR methodology given the low earnings visibility.
“One of Affin Hwang’s least preferred picks,” it said.