SATS Poised for Growth: Strategic Initiatives and Acquisition Drive Buy Rating with S$3.60 Target Price

CGS-CIMB analyst Wee Kuang Tay reiterated a Buy rating on SATS (SPASF – Research Report) yesterday and set a price target of S$3.60.

Wee Kuang Tay’s rating is based on SATS’s strategic initiatives and financial performance. The company is poised for continued market share growth in the global air cargo industry, leveraging its acquisition of Worldwide Flight Services to enhance cross-selling opportunities and expand its customer base. This expansion is expected to bolster SATS’s resilience against global trade uncertainties and support its earnings growth.
Additionally, SATS’s increased headcount and investments in infrastructure, such as the Terminal 5 project at Changi Airport, indicate its commitment to supporting key clients and future growth. The company’s strong revenue growth has significantly improved its operating leverage, with expectations for further margin expansion as integration efforts continue. These factors collectively underpin the Buy rating, with a target price of S$3.60, reflecting confidence in SATS’s ability to capitalize on growth opportunities while managing potential risks.

According to TipRanks, Kuang Tay is a 2-star analyst with an average return of 0.8% and a 46.43% success rate.

In another report released on May 27, DBS also maintained a Buy rating on the stock with a S$3.50 price target.