Analyst recommendations have gradually improved over the past five years, and now Indonesia is on the verge of a “buy” recommendation.
The top two stocks with the most positive recommendations are related to construction in Indonesia. Wijaya Karya Beton is a precast concrete manufacturer with a capitalization of $557 million.
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Bank Jatim is up 35% YTD, and Bank BJB is up 290%! After such large increases in value, both are currently receiving negative recommendations.
Consensus Earnings Estimates: Indonesia
Analysts’ expectations have hovered around 10-15% EPS growth, but Indonesia has seen 4 years of falling earnings.
Average earnings estimates for 2016 are lower this time at 5%.
Though real estate developer Lippo Karawaci has among the most negative recommendations, it also has the highest EPS growth estimate, and its share price is down 30% YTD.
Bukit Asam has the worst EPS growth estimate, but the share price has gained about 180% YTD.
Consensus Target Prices: Indonesia
Target price expected returns and actual returns are currently in line for 2016. The 12-month forward target prices imply an expected return of 13%.
XL Axiata is part of one of the largest telecom groups in Asia, Axiata Group Bhd (AXIA.KL). Of AXIA’s listed group companies, all except the one in Sri Lanka has seen a share price loss of about 30% YTD.
Bank Jatim and Bank BJB are also found among the lowest expected returns, as they’ve performed well YTD.
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