Venture shares may be in focus after BlackRock raises stake

Singapore one dollar bill

Shares of Venture may see a fresh round of interest after giant fund manager BlackRock raised its stake in the tech player.

In an SGX filing after the market close on Friday, BlackRock reported that it had become a substantial shareholder in Venture, with its deemed interest rising to the 5.0 percent threshold from 4.94 percent previously.

That could be read as a vote of confidence for the company.

Venture’s shares have fallen since it reported earnings after the market close on February 28. But the decline was likely as the stock had already climbed more than 30 percent so far this year, with earnings beating analysts’ expectations handily.

For the full year, Venture said after the market close that its net profit more than doubled to S$372.8 million on record revenue of S$4.0 billion, which was a nearly 40 percent on-year rise. Venture said its fully diluted earnings per share (EPS) for 2017 was S$1.30, more than doubling on-year.

Analysts were very positive on the results.

Earnings beat forecasts

DBS, in a Thursday note subtitled “prospects burning bright,” raised its target price to S$32.20 from S$26.00 after increasing its 2018-19 earnings forecasts by 20-27 percent. It kept a Buy call.

”Fueled by positive industry backdrop and excellent execution, Venture’s share price has gained more than 150 percent over the past year, but we believe there is still room to run as it continues to deliver superior earnings performance,” DBS said, adding it believed the market hadn’t yet fully priced in Venture’s “unique offerings, know-how and hard-to-replicate ecosystems.”

DBS said fourth-quarter earnings beat its forecast by more than 30 percent.

Separately, UOB KayHian has recently tipped that it believed Venture was manufacturing a potential blockbuster “mystery product,” which it declined to name. That brokerage, however, pointed to signs that investors may want to prepare to take some profit on the share.

Shares of Venture ended Friday down 0.30 percent at S$26.84. The stock’s February low of S$21.74 was likely to act as a near-term support, while the February high of S$27.60 could offer an initial cap.