According to analysts, the share price of the SGX-listed manufacturer UMS Holdings Limited (SG:558) has received a Strong Buy rating. Despite the positive outlook, the potential for additional growth in the stock seems limited, considering the recent surge in the share price. The share price has witnessed a significant increase of over 20% in the past three months, primarily driven by the release of the company’s first-half results for FY23.
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Recently, analysts have expressed their positive opinions about the stock, as they believe that the company is poised to benefit from a recovery in the semiconductor industry in FY24. Analysts also anticipate increased prospects for a rebound in orders in the upcoming fiscal year.
UMS Holdings is a manufacturing company operating in the semiconductor industry. The company’s reach extends to various sectors, including electronics, machine tools, aerospace, and oil and gas.
Recent Ratings
Eight days ago, analyst Jarick Seet from Maybank upgraded his rating on the stock from Hold to Buy. He also raised his price target on the stock from S$1.16 to S$1.44, based on a multiple of 11 times the earnings estimates for FY24. The price target is almost 10% above the current trading levels.
Seet stated that the company’s lower orders have impacted its financial performance in FY23, which is expected to improve in FY24. He further highlighted that Applied Materials, Inc. (NASDAQ:AMAT), one of the primary customers of UMS, has revised its revenue and profit guidance for the fourth quarter of this year. This positive development suggests a potential increase in orders for UMS, assuming that AMAT’s inventory levels will be depleted at an accelerated pace. Seet anticipates that the financial results for the second half of FY23 might exhibit a modest weakness, similar to the performance observed in the first half of the fiscal year.
15 days ago, UOB Kay Hian analyst John Cheong confirmed his Buy rating on the stock, predicting a 19% increase in the share price. Cheong is also optimistic about AMAT’s raised guidance, driven by growing demand for AI-related chips and a surge in orders from its clientele in China.
What is the Target Price for UMS?
558 stock has received a Strong Buy rating on TipRanks, backed by all Buy recommendations from four analysts. The UMS share price target is S$1.42, which is 8.5% higher than the current trading level.
