ComfortDelGro’s Strong Revenue Growth and Attractive Yield Justify Buy Rating Despite Mixed Results

Analyst Llelleythan Tan from UOB Kay Hian maintained a Buy rating on Comfortdelgro (CDGLF – Research Report) and decreased the price target to S$1.71 from S$1.76.

Llelleythan Tan has given his Buy rating due to a combination of factors including ComfortDelGro’s strong year-over-year revenue growth of 16.4% in the first quarter of 2025, which was driven by all business segments. The public transport segment benefitted from increased domestic fares and ridership, as well as improved margins in the UK. Additionally, the taxi segment experienced a significant boost from recent acquisitions, despite facing stiff competition.
Despite the mixed results, where the operating profit and PATMI were slightly below expectations due to higher amortization costs from a new accounting change, the company’s performance still showed robust growth. The analyst expects this positive momentum to continue into the second quarter of 2025. Furthermore, with a decent yield of 5.8%, the stock remains attractive, leading to the maintenance of a Buy rating, albeit with a slightly lower target price of S$1.71.

According to TipRanks, Tan is a 2-star analyst with an average return of 1.6% and a 51.35% success rate.

In another report released today, DBS also maintained a Buy rating on the stock with a S$1.80 price target.