Institutional sharebroker ABN Amro has lifted its valuation of Lyttelton Port and upgraded the stock to "buy" after researching Solid Energy's 13-year deal to move coal through the port.
Lyttelton is a minnow among listed port companies, with a market capitalisation of $181 million compared with the $750 million of Ports of Auckland and Port of Tauranga.
ABN Amro has lifted its per share valuation of the company from $1.66 to $1.98. The shares closed yesterday at $1.77.
The broker says Lyttelton is better value for investors than the two bigger listed port companies.
The upgrade from a hold came after analysis of last year's deal between rail company Toll and Solid Energy to transport coal to the port.
Solid Energy will freight 2.4 million tonnes of coal to the port this year, increasing to 3.8 million tonnes from 2007/08.
ABN Amro said the company had the highest gross yield of four listed port companies - 9.4 per cent - and the lowest price-to-earnings ratio.
The two bigger listed ports could be affected this year by a review of the hundreds of millions of dollars New Zealand's biggest exporter, Fonterra, spends on ocean freight.
Construction on a new hub for the dairy company's dry goods exports from the Waikato begins this year.
Ports of Auckland is competing with the Port of Tauranga for the business.
ABN Amro's report says this raises the spectre of a price war.
The broker said it was taking "an increasingly conservative approach" to the ports because of that possibility.
\"The overweening conceit which the greater part of men have of their own abilities [and] their absurd presumption in their own good fortune.\" - <b>Adam Smith</b> - <i>The Wealth of Nations</i>
The information you have is not the information you want.
The information you want is not the information you need.
The information you need is not the information you can obtain.
The informaton you can obtain costs more than you want to pay.
You have been a big supporter of POT over POA. What do you think of ABN Amro's evaluation of LPC as the port with the most value?
\"The overweening conceit which the greater part of men have of their own abilities [and] their absurd presumption in their own good fortune.\" - <b>Adam Smith</b> - <i>The Wealth of Nations</i>
The information you have is not the information you want.
The information you want is not the information you need.
The information you need is not the information you can obtain.
The informaton you can obtain costs more than you want to pay.
Sorry guys this share wallows about below my expectation level. Havent given it much thought. Have been with POA and POT in the past both treated me well. I only get interested in a share on a high trend. POT is the best PORT company. LPC to much pomme union troubles for me.
GOOD LUCK MACDUNK
Sorry guys this share wallows about below my expectation level. Havent given it much thought. Have been with POA and POT in the past both treated me well. I only get interested in a share on a high trend. POT is the best PORT company. LPC to much pomme union troubles for me.
GOOD LUCK MACDUNK
In any event, LPC would have been 'timed-out' if you had been holding it last year?! *Assuming that I am finally understanding your TIME criteria*
ABN Amro do some sums nad everybody falls overthemselves to get a piece of the action ... up to 195n odd .... leemings
Macdunk says watch these pommie unions
He must have foresaw what was going to happen ... overtime ban all that union stuff ... again ... no doubt more pickets ... hope nobody gets killed this time around
And the price falls accordingly .. but not quite back to where it was ..yet
“ At the top of every bubble, everyone is convinced it's not yet a bubble.”
Reply With Quote
Bookmarks