Reuters: Hot Stocks: STOCKS NEWS SINGAPORE-UOB raises Ezion target to S$1.42

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STOCKS NEWS SINGAPORE-UOB raises Ezion target to S$1.42 Jun 7th 2012, 01:58 Wed Jun 6, 2012 9:58pm EDT UOB Kay Hian raised its price target on the stock of offshore services provider Ezion Holdings to S$1.42 from S$1.34 after the firm won a third service rig contract worth $86.3 million. Ezion shares were up 0.65 percent at S$0.780 at 0145 GMT, outperforming the FT ST Small Cap Index, which was up 0.3 percent. The stock has risen 19 percent so far this year, outperforming a 6 percent gain in the index. The charter contract is for four years with total revenue at $86.3 million or $21.6 million per year, and UOB estimates the project to yield a net profit of $7 million, adding 7 percent to its 2013 and 2014 earnings forecast. The broker said the customer is Mexico's Pemex. The project also has a "very high" return on equity (ROE) of 42 percent, well above Ezion's minimum project ROE requirement of 30 percent, said UOB and maintained its 'buy' rating on the stock. The broker added that it expects Ezion's share price to benefit from a ramp-up in earnings as more liftboats and service rigs come onstream and demand is seen strong. (Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com)

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