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JP Morgan rates AWE as Overweight
Friday, October 4, 2013 - 10:50
October 4, 2013
AWE has purchased an additional 15% of the Tue project, increasing its interest to 57.5%. The deal makes sense in JP Morgan's opinion. It results in a minor valuation uplift of 1% and drive FY14 and FY15 earnings accretion of 8% and 5% respectively.
The stock has been a poor relative performer over the last 12 months and languishes at a deep discount to the broker's NAV. JP Morgan ponders whether perhaps the NZ drilling campaign may reinvigorate interest. The Overweight rating is retained and the price target is raised to $1.92 from $1.90.
Target price is $1.92 Current Price is $1.20 Difference: $0.72 If AWE meets the JP Morgan target it will return approximately 60% (excluding dividends, fees and charges).
The company's fiscal year ends in June. JP Morgan forecasts a full year FY14 dividend of 0.00 cents and EPS of 21.00 cents.
At the last closing share price the stock's estimated Price to Earnings Ratio (PER) is 5.71.
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