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Thursday tips round-up: Lamprell, Enquest

Thu, 27th Mar 2014 07:23

Oil and gas engineering services provider Lamprell´s shares took a knock on Wednesday following the company´s guidance for flat or little-changed revenues this year and next. The reaction looks a little overdone. Such an outlook was to be expected given current subdued industry conditions in the North Sea. As well, the company´s operating profits came in at 52.9m dollars, marking a significant recovery from a difficult 2012. Is a dividend on the way? Yes. The prospects in that regard are improved thanks to the recent sale of Inspec, the non-core testing business, for $66m. Significantly, its problematic legacy assets seem to have been resolved. Even so, given that flat revenue outlook and the fact the stock is changing hands at about 14 times' earnings investors should be in no hurry to buy, says The Times´s Tempus. North Sea oil producer EnQuest´s focus on smaller assets that are worthwhile, but out of the scope of its larger rivals, should offer the company greater visibility on revenues than can be found at the typical explorer. Investors, however, reacted very negatively to its production forecast of between 25,000 and 30,000 barrels a day for this year, which came in a tad below expectations. That is chiefly because the atrociously bad weather this year will delay the start of production at its Alma/Galia field until the second half. On the other hand, its Kraken field will begin to flow towards late 2016 and bring production up to the targeted 50,000 barrels of oil a day. Given it's relatively lower risk yesterday´s share price fall affords investors a decent entry point if they have a long-term horizon, Tempus writes. Please note: Digital Look provides a round-up of news, tips and information that is impacting share prices and the market. Digital Look cannot take any responsibility for information provided by third parties. This is for your general information only as not intended to be relied upon by users in making an investment decision or any other decision. Please obtain a copy of the relevant publication and carry out your own research before considering acting on any of this information.AB
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Copyright 2022 Alliance News Limited. All Rights Reserved.

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