Deutsche Bank 22/01/2010 1 Buy $42.45 8.5% The broker sees the company as being in an earnings upgrade cycle, which is supported by a large pipeline of infrastructure and LNG projects and increasing demand for commodities.
The broker expects margins to expand as FY09 operational issues clear and despite the stock trading on a FY11 PER of 16x, which is a 17% premium to ASX industrials ex banks, the broker still thinks the premium is warranted.
Deutsche cites double digit earnings growth to FY13, strong working capital management, industry leading return on capital and the potential for participating in upcoming large projects as its reasons. The Buy call is maintained.
LEI Price at posting:
$38.36 Sentiment: ST Sell Disclosure: Not Held
