AEM Holdings - CGS-CIMB Research 2020-05-07: Raises Guidance Again

AEM HOLDINGS LTD (SGX:AWX) | SGinvestors.io AEM HOLDINGS LTD (SGX:AWX)

AEM Holdings - Raises Guidance Again

  • AEM's order book for delivery in FY20F (previously S$338m) increased to S$416m (+23%/+S$78m).
  • The company raised its FY20F revenue guidance to S$430m-445m (S$360m-380m previously).
  • Reiterate ADD; higher Target Price driven by new revenue guidance.



AEM raises FY20F revenue guidance

  • Late last night, AEM Holdings (SGX:AWX) announced that as at 4 May 2020, its order book for delivery in FY20 has risen to S$416m (+23% or S$78m from the 25 Feb order book of S$338m).
  • AEM also revised upwards its FY20F revenue guidance to between S$430m and S$445m (previous guidance was between S$360m and S$380m). The new revenue guidance will be achieved with an unchanged capex guidance of S$4m. The high end of the revenue guidance at S$445m is 11% above our current FY20F revenue estimate.


Upward revision overdue



Intel (AEM’s key customer) progressing on track

  • Intel is continuing with its new chip launches. On 30 Apr, Intel introduced the 10th Gen Intel® Core™ S-series desktop processors, including Intel’s flagship Core i9-10900K processor which the company claims is the world’s fastest gaming processor. These processors are expected to be available globally in May.
  • In terms of moving beyond its core strength in computers, Intel announced on 4 May that it has acquired Moovit, a mobility-as-a-service (MaaS) solutions company. Moovit is an urban mobility application that offers multimodal trip planning by combining public transportation, bicycle and scooter services, ride-hailing, and car-sharing. Intel said that the addition of Moovit brings its Mobileye (developer of vision-based self-driving car and ADAS) division closer to achieving its plan to become a complete mobility provider, including robotaxi services.
  • Intel is investing and expanding to serve new data-rich market opportunities, including the fast-growing market for ADAS (advanced driver assistance systems), data and MaaS technologies, which together (in Intel’s view) could represent an opportunity totalling more than US$230bn by 2030.


Reiterate ADD; higher Target Price driven by new guidance






William TNG CFA CGS-CIMB Research | https://www.cgs-cimb.com 2020-05-07
SGX Stock Analyst Report ADD MAINTAIN ADD 3.58 UP 3.100



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