EOS - Citi rates the stock as Buy
PUBLISHED
2020-12-23
Content
The company has withdrawn 2020 earnings (EBIT) guidance which, as Citi notes, highlights the uncertainty surrounding the timing of RWS deliveries to foreign customers because of the pandemic.
While the Australian Defence Force contract for 251 RWS has commenced this has not offset the headwinds such as freight bottlenecks and the adverse impact of a stronger Australian dollar.
The withdrawal of guidance was not surprising and the broker still maintains a Buy/High Risk rating given the exposure to high growth sectors. Target is reduced to $7.75 from $7.80.
Sector: Capital Goods.
Target price is $7.75.Current Price is $5.90. Difference: $1.85 - (brackets indicate current price is over target). If EOS meets the Citi target it will return approximately 24% (excluding dividends, fees and charges - negative figures indicate an expected loss).