Credit Suisse said it has raised its target price for Evergreen Marine Corp (長榮海運), the nation’s largest shipper, to NT$31 from NT$25 on an improving earnings outlook.
Credit Suisse said in a research note that it has also maintained an “outperform” rating on the stock, which closed up NT$0.1 at NT$22.6 on Friday.
The brokerage said that while the company is not particularly transparent, the company’s earnings in the first half of this year and sales in recent financial statements pointed to a rebound in line with the global shipping industry.
In the second quarter, Evergreen Marine posted about NT$4 billion (US$130 million) in net profit, compared with a net loss of NT$87 million registered in the first quarter.
Last year, Evergreen Marine recorded a NT$9.86 billion net loss on the lingering impact of the global financial meltdown that first battered the world economy in late 2008.
“We believe Evergreen Marine’s long-term competitiveness is rising on new ship orders,” Credit Suisse said. “We believe these ships are competitive compared with its peers in terms of cost.”
The company has commissioned South Korea’s Samsung Heavy Industries Co to build 20 ships, each of which will have a cargo capacity of 8,000 20-foot equivalent units, for US$2.06 billion.
The delivery of the new ships will start from 2012.
Credit Suisse has also raised its forecast of Evergreen Marine’s net profit this year to NT$14.36 billion from an earlier estimate of NT$3.25 billion, and to NT$15.07 billion from NT$6.53 billion for next year.
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