UOB Kay Hian analyst John Cheong upgraded the rating on UMS Holdings (UMSSF – Research Report) to a Buy yesterday, setting a price target of S$1.21.
John Cheong has given his Buy rating due to a combination of factors that suggest a positive outlook for UMS Holdings. Despite a 32% year-over-year decline in earnings for 2024, the results were in line with expectations, and the company is poised for growth with the ramp-up of production for a new key customer. This development is expected to lead to significant revenue growth and improved net margins, as start-up costs decrease.
Furthermore, UMS is anticipating strong order flows and has a positive outlook for 2025, supported by the acceleration of AI investments and increased demand from major global semiconductor customers. Additionally, the ongoing global air travel boom is expected to bolster the performance of UMS’s aerospace business. These factors contribute to the decision to upgrade the stock to a Buy rating with a 27% higher target price of S$1.21.
In another report released yesterday, DBS also upgraded the stock to a Buy with a S$1.31 price target.