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2009-1-5 12:00:00 p.m. HKT, XFNA
DJ MARKET TALK: Cnooc +4.1%; DCF Fair Value At HK$12.00 - CLSA
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| 1152 [Dow Jones] Cnooc (0883.HK) +4.1% at HK$7.90, supported by crude price rise, with analysts expecting crude to recover to $50/bbl soon. Gordon Kwan at CLSA says Cnooc's current valuation reflects sub-$40/bbl long-term oil prices. Says his house's DCF-based long-term $80/bbl real oil price values Cnooc at HK$12.00/share; sets target price at HK$7.20 based on 40% discount to DCF fair value to reflect market's diminished risk appetite. Kwan adds he would raise his target price "if oil prices continue to trend higher on back of sustained geopolitical jitters." Keeps stock at Outperform, with 5% dividend yield. Other oil stocks underperform vs Cnooc, with PetroChina (0857.HK) +3.2% at HK$7.43, Sinopec (0386.HK) +2.8% at HK$5.10. (SUT) Contact us in Hong Kong. 852 2802 7002; MarketTalk@dowjones.com
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(Delayed by 1 hour)
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