- We upgrade Venture Corp (SGX:V03) to BUY from Hold, premised on:
- At current FY23F/FY24F P/E of 12.6x/11.2x, Venture Corp's share price is trading at the previous low in March 2020, which was due to the COVID pandemic. We believe the attractive valuation should not be ignored for a company with strong financials, above-peers’ net margins and high net cash as % of market capitalization at 24%.
- - Read this at SGinvestors.io -
- Higher dividend on the cards?
Weak demand coupled with MSCI portfolio rebalancing led to a steep decline in Venture Corp's P/E.
- - Read this at SGinvestors.io -
- Venture Corp’s P/E valuation has plummeted to more than 2 standard deviation below its four-year average and is now at the depressed level seen in March 2020 when valuations were hit by the COVID pandemic.
- At the current valuation of ~12x, Venture Corp is now trading on par with its global peers. Compared to Singapore-listed peers, the valuation is still ~10% above its peers, which can be justified by its high net margins of close to 10%, vs low single digits of its peers. Furthermore, Venture Corp is also in a strong net cash position, vs mainly net debt for its global peers.
A value trap or attractive entry level to position for an anticipated recovery in 2024?
- Read more at SGinvestors.io.
