AmIvest Research upgrades QES to Buy, FV 28 sen

KUALA LUMPUR: AmInvestment Research upgraded its recommendation on QES Group to Buy from Hold and raised its fair value to 28 sen a share from 21 sen.

It said on Thursday this was based on a rolled-forward FY20F PE of 12 times which represents a 50% discount to the average PE of 24 times of larger equipment makers.

“We keep our earnings forecasts unchanged, ” it said.

AmInvest Research said QES is anticipating a better 2HFY19 based on several developments.

QES’s manufacturing segment is expanding from post-wire bonding to include two new automated optical inspection (AOI) product series.

QES is also expanding sales out of Asean especially in China, Taiwan & Europe.

The group expects higher orders from semiconductor customers in 3QFY19, based on shipments seen in July and August.

Its distribution segment is set to increase and sustain recurring income with service and spare parts continuing to be the key contributor.

QES is also discussing with a potential customer on a solution to be incorporated into the lapping and polishing process.

Source: TheStar