Aztech Global Ltd. (8AZ – Research Report), the Technology sector company, was revisited by a Wall Street analyst on February 25. Analyst William Tng from CGS-CIMB downgraded the rating on the stock to a Hold and gave it a S$0.67 price target.
William Tng has given his Hold rating due to a combination of factors impacting Aztech Global Ltd. While the company’s FY24 net profit aligned with expectations, revenue fell short by 9% compared to both internal and Bloomberg consensus forecasts. This discrepancy was primarily due to slower-than-expected order book recovery, which led to a downgrade from an Add to a Hold rating.
Despite the revenue shortfall, Aztech’s net margin remained robust, supported by cost management and unexpected special dividends. However, the company faces challenges such as demand volatility, geopolitical tensions, and economic uncertainties, which could hinder future growth. Consequently, revenue and EPS forecasts for FY25-26 have been reduced, resulting in a lower target price. The Hold rating reflects the expectation of slower order recovery, balanced by the potential for decent dividend yields.
According to TipRanks, Tng is a 4-star analyst with an average return of 10.0% and a 67.35% success rate.
In another report released yesterday, UOB Kay Hian also maintained a Hold rating on the stock with a S$0.65 price target.