Sydney, Sep 27, 2006 AEST (ABN Newswire) - The latest MicroEQUITIES's analysis report on KLM GROUP focuses on this company's recent acquisitions which are expected to drive earnings growth for 2006/07.
- MicroEQUITIES estimates that Allied Technologies cable business will add around $15M AUD to KLM's top line for 2006/07
- MicroEQUITIES raises its recommendation on KLM Group from BUY to STRONG BUY, and its price objective from $0.50 to $0.60
According to the report, KLM's growth will be driven by the bolt on acquisitions executed during 2006 and particularly the Allied Technologies acquisition, which will add significant scale to KLM's operations. "The acquisition of the Allied Technologies cable business will provide some synergistic cost savings possibilities, particularly in the areas of administration and rental expenses", highlights MicroEQUITIES.
The Micro cap specialist research firm considers that one of key strengths of the purchase is that Allied Technologies and KLM did not share any client duplicity. "The purchase should provide KLM not only with revenue growth but the opportunity to cross sell KLM's traditional core services to the acquired client list Allied Technologies".
MicroEQUITIES estimates that the Allied Technologies cable business will add around $15M AUD to KLM's top line for 2006/07 and forecasts an EBIT margin improvement of 71 basis points from 3.85% in 05/06 to 4.56% in 06/07. After adjusting its forecasts, MicroEQUITIES has raised its recommendation on KLM Group from BUY to STRONG BUY and increased its price objective from $0.50 to $0.60
"The company's growth strategy is so far delivering on its promise of adding scale and depth to its operations whilst improving margins and profitability", concludes MicroEQUITIES.
About MicroEQUITIES
MicroEQUITIES is an Australian company established with a singular vision: to actively investigate and research investment opportunities in Micro Cap companies listed in the Australian Stock exchange.
The company provides value adding professionally elaborated extensive research within an area of huge investment potential but poorly covered by Australia's investment banking community, the micro cap investment universe. Therefore, MicroEQUITIES's aim is to rebalance that information inequality, inform investors, and at the same time provide its clients with superior returns.
MICROEQUITIES PTY LTD is an Australian Financial Services licensee, which authorises the company to provide general investment advice on securities to retail and wholesale clients.
Contact
MicroEQUITIES / Eva Beltran
T. +61 2 9362 9051/
F. +61 2 9475 1156
M. +61 402 233 782
ebeltran@microequities.com.au
www.microequities.com.au
| ||
|
