UOB KayHian upgraded Singapore Press Holdings to Hold from Sell after the media and property company reported first half earnings that were in line with its forecasts.
The brokerage said that core net profit of S$90 million for the fiscal first half of 2018 was 43 percent of its full-year earnings forecast.
“Despite the 12.7 percent year-on-year decline in our page count, the fall in advertising revenue turned out to be lower than expected. This suggests that media earnings might be starting to find a floor, probably helped by an uplift in retail ad spending, and likely to be further supported by the expected boost from property advertising,” the brokerage said in a note on Wednesday.
But UOB KayHian wasn’t keen on the idea of buying the share just yet.
“SPH’s Media earnings seem to have found a floor, and the attractive 5.2 percent forward yield will likely provide support to the share price,” it said. But it added, “The earnings growth outlook remains muted for the next few quarters and it may still be early to buy into a potential recovery.”
The brokerage raised its target price slightly to S$2.41 from S$2.39, and tipped an entry price at S$2.30.
The stock was up 0.40 percent at S$2.50 at 4:29 P.M. SGT on Wednesday.