Analyst Yik Ban Chong of Phillip Securities maintained a Buy rating on Centurion Corporation Limited (OU8 – Research Report), with a price target of S$1.22.
Yik Ban Chong has given his Buy rating due to a combination of factors influencing Centurion Corporation Limited’s performance. The company’s financial results for FY24 exceeded expectations, driven by increased rental rates and high occupancy levels in both worker and student accommodations. This strong performance is expected to continue into FY25, supported by rental rate adjustments and the ramp-up of the new Westlite Ubi facility, which is anticipated to reach full occupancy by March 2025.
Additionally, the student accommodation segment is experiencing robust growth, particularly in the UK and Australia, where occupancy rates have risen significantly. The company’s financial health is further bolstered by an increase in interest cover, suggesting improved profitability and financial stability. Despite a slight reduction in the EV/EBITDA multiple assumption, the target price has been raised, reflecting confidence in Centurion’s future prospects. The company’s decision to increase dividends by 40% also signals a positive outlook and commitment to returning value to shareholders.
In another report released yesterday, UOB Kay Hian also maintained a Buy rating on the stock with a S$1.16 price target.
Based on the recent corporate insider activity of 9 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of OU8 in relation to earlier this year.