Stocks

Earnings Estimate For Thailand Lowest In Five Years

by Dr. Andrew Stotz, CFA

Consensus Recommendations: Thailand

Analysts have had positive recommendations on Thailand for 5 years, and sure enough it remains a Buy in Asia, although growth estimates are the lowest they’ve been in five years.

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Many stocks continue to hold investor interest.

The bullish view on Thai Foods Group is based on expectations of higher chicken and live pig prices, as well as TFG’s ability to increase its sales volume.

Thailand

Analysts are pessimistic about Thai Vegetable Oil, however, as imported cheap soybean meal from Argentina is putting pressure on TVO’s gross margin.

Consensus Earnings Estimates: Thailand

As mentioned earlier, the current consensus EPS growth estimate is the lowest in 5 years, down from 10% in December of last year.

Of course that doesn’t apply to all stocks. Analysts believe the rubber industry is entering a new cycle and expect Sri Trang Agro Industry to turn its highest net profit since 2013 after a net loss last year.

Consensus #earnings growth estimate for #Thailand is the lowest in 5 years

Analyst consensus expects a fall in EPS growth for Indorama Ventures due to a high base, since the company made a bargain purchase that was booked in 2016.

Consensus Target Price: Thailand

The 12-month forward expected return for the market is now at 8% versus 10% in December 2016. They mostly explain the change as due to a slight gain of the SET Index since then.

The 12-month forward expected return for the #SET Index is now at 8%

In line with the expected turnaround and growth in EPS, Sri Trang Agro Industry also has among the highest consensus target price expected returns at 49%.

Analysts are worried about low growth though, and have taken out their pessimism on Jasmine International, whose target price is expected to fall by 31%.

Article by Dr. Andrew Stotz, Become A Better Investor

Author: Dr. Andrew Stotz, CFADr. Andrew Stotz, CFA is the CEO of A. Stotz Investment Research, a company providing institutional investors with ready-to- invest portfolios in Asia that aim to beat the benchmark through superior stock selection. The company also provides buy- and sell-side clients with financial models to value any company in the world and World Class Benchmarking to determine what companies are financially world class. Previously, as Head of Research at CLSA, Andrew was voted No. 1 Analyst in Thailand in the Asiamoney Brokers Polls for 2008 and 2009. He was also voted No. 1 Analyst in Thailand in the 2009 Institutional Investor magazine All-Asia Research Team Report. Andrew earned his PhD in finance at the University of Science and Technology of China in Anhui province, with a focus on answering questions raised by fund managers and analysts during his career about picking stocks and managing portfolios. In addition, Andrew has been a lecturer in finance for 22 years at various universities in Thailand. Since 2013, he has been the president of the CFA Society of Thailand. He is also the author of How to Start Building Your Wealth Investing in the Stock Market.