CGS-CIMB analyst Wee Kuang Tay reiterated a Buy rating on Delfi (PEFDF – Research Report) today and set a price target of S$0.88.
Wee Kuang Tay has given his Buy rating due to a combination of factors including Delfi’s strong market position and the potential for future profitability improvements. Despite current challenges such as elevated cocoa prices and currency fluctuations affecting profitability, Delfi maintains a leading market share in the Indonesian chocolate confectionery segment, which positions it well against competitors.
Additionally, the company’s valuations are currently considered attractive, trading at a depressed forward P/E ratio compared to its historical average. While near-term margins are under pressure, the expectation is that raw material costs will ease in the future, potentially enhancing profitability. The company’s commitment to maintaining its dividend payout ratio further supports investor confidence, despite the absence of a special dividend this year.
According to TipRanks, Kuang Tay is a 2-star analyst with an average return of 0.7% and a 38.89% success rate.