Tomypak Holdings - An unstable package

Stock Name: TOMYPAK
Company Name: TOMYPAK HOLDINGS BHD

Research House: CIMB

Price Call: BUY

Target Price: 1.34

Target RM1.34

Tomypak's 23% results shortfall in FY11 and 45% decline in 4Q11 earnings paled in comparison to its peer, Daibochi. This surprised us given its superior margins in the past few years. Fortunately, the share price downside risk is capped by its 6-7% net dividend yield.

Source: CIMB Daybreak February 29, 2012, Full PDF Report

CIMB Research maintains Outperform on Tomypak

Stock Name: TOMYPAK
Company Name: TOMYPAK HOLDINGS BHD

Research House: CIMB

Price Call: BUY

Target Price: 1.52

KUALA LUMPUR: CIMB Equities Research said Tomyopak's failure to pass through cost increases was the main reason for its poor interims.

The research house said on Friday, Aug 19 that annualised 1H11 net profit was only 62% of its forecast though this did not stop the company from meeting its 1.4 sen interim DPS expectations.

'Although we foresee a strong earnings recovery in 2H following the recent steep fall in raw material prices, we are slashing our FY11 EPS by 21% for the weak 1H earnings. But FY12-13 EPS forecasts and FY11-13 DPS numbers are intact,' it said.

CIMB Research retained its RM1.52 target price as it continues to value Tomypak at 6x CY12 P/E, a 40% discount to its 10.1x CY12 target P/E for Daibochi. CY12 P/E is only 4x while gross dividend yields are 8-10%.

'We maintain our OUTPERFORM rating as a continuation of the raw material price decline could spark a re-rating,' it said.

TOMYPAK - CIMB Research maintains Outperform on Tomypak, lowers TP to RM1.53

Stock Name: TOMYPAK
Company Name: TOMYPAK HOLDINGS BHD
Research House: CIMB

KUALA LUMPUR: CIMB Equities Research said'' Tomypak's annualised 1Q11 net profit was only 48% of its forecast, clearly below expectations as the company absorbed some cost increases, probably to avoid a volume backlash.

It said on Friday, May 6 that however, the 1.4 sen interim DPS was within expectations.

'We are slashing our FY11 EPS by 23% to reflect the margin squeeze while cutting FY12-13 by 2-7% as margins should recover by then.

'Our FY11 DPS forecast is cut by only 13% as we revise our payout ratio from 25% to 30%.

'We now value Tomypak at 6x CY12 P/E, a 40% discount to our 10.1x CY12 target P/E for Daibochi instead of 30%. Although our target price drops from RM1.80 to RM1.53, the stock remains OUTPERFORM as it offers a CY12 P/E of only 4x and 7-10% dividend yields. The main potential catalyst is a sharp fall in raw material prices.'