UBS downgrades Olam to 'sell' from 'buy'

[jubilee1919]

Reuters
Wednesday, Jan 09, 2013

SINGAPORE - UBS downgraded Olam International Ltd to 'sell' from 'buy' and cut its target price to S$1.33 from S$2.95,citing uncertainties around the cost of its Gabon project.

Olam shares were down 0.3 per cent at S$1.60 by 0100 GMT, around 8 per cent below the level they were at before short-seller Muddy Waters launched an attack on the commodities trading company for its accounting practices and aggressive acquisitions.

UBS said the World Bank now estimates the total cost of the Gabon project to be at $1.5 billion to $2 billion, compared with Olam's initial estimate of S$1.3 billion.

"A cost overrun and project delays significantly increase the risk to management's target of turning free cash flow positive by 2015," said UBS in a note.

The brokerage also said its bankruptcy analysis of Olam shows the company's financial position has deteriorated to below financial health levels, but remains above distress levels.

"A number of concerns have arisen in recent months," said UBS, including Olam's earnings quality and growth, deteriorating returns on asset investment, the risk of Nigerian export credit write-downs, management compensation, the recent share buyback considering its capacity expenditure requirements and negative free cash flow.

http://www.asiaone.com/News/AsiaOne%2BNews/Business/Story/A1Story20130109-394260.html

Singaporeans can wait long long for their CPF money.

 

[Bigfuck]

UBS is so ungrateful after being wooed by Jinx enterprises with so much money. lol.

Looks like a Ooh Lumpar.

 

[shctaw]

Stupid ANALyst. Cannot even judge a share properly....

How can something be value by them at $2.95 all a sudden become $1.33.

Insider trading....?

 

[syed putra]

very smart move by temasek. After paying for rights issue, they now short the shares for double the profits with the help of their counterpart in DBS.

 

[ragout]

Most of the people involved in this line are big time crooks who will make your money disappear very fast if you are not too careful. They will play on your greed and fears to make your money. Be careful when you trade.

 

[watchman8]

Stupid ANALyst. Cannot even judge a share properly....

How can something be value by them at $2.95 all a sudden become $1.33.

Insider trading....?

This is the result of aggressive leverage used by the greedy ah nehs running olam. When the investment value drop a little, the company's equity dries up very quickly.

 

[Bigfuck]

very smart move by temasek. After paying for rights issue, they now short the shares for double the profits with the help of their counterpart in DBS.

You are accusing Jinx of a worse failing- manipulation and insider trading.