Research Summary Imdex Limited’s (IMD) AGM commentary highlighted a solid 1Q12 start, with management cautiously optimistic for FY12. While the underlying thematics of robust global exploration spend should support IMD’s earnings in FY12/13, we believe integrating the five business acquisitions made over the last 12mths increases operational risks. As a result, we remain cautious in our earnings forecasts and retain our below consensus view. With the share price in line with our valuation, we downgrade our Buy recommendation to an Underperform, with a 12-month share price target of A$1.80/sh (prev A$2.00/sh) based on our 7x FY12 EV/EBIT valuation.
IMD Price at posting:
$1.98 Sentiment: None Disclosure: Not Held
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