First Energy Capital Lowers To $8.50 Poseidon’s (PSN) Q312 Results Weaker than Expected
- Ozymandias
Poseidon Concepts Corp. (PSN)
TSX listed : $13.22 | Underperform: $8.50 | Kevin Lo
3Q12 results were marred by weaker revenue, more competitive
day rates, lower profitability, and A/R collection issues. As such,
we have lowered our 2013e EBITDAS estimate to $118 from
$234 mm.
The Company also revealed their new product line, which
includes a tank heater, temperature monitor, and fluids transfer.
We believe that these products will partially offset the lower
revenue from the tank business.
With a ~50% reduction in estimates, we are lowering our target
price to $8.50/share (prior: $20.00/share), which equates to 5.6x
2013e EV/EBITDAS and 8.2x earnings. With an implied negative
return of 24% (when the dividend is included), we rate the stock
as Underperform (prior: Outperform).