very strong resistance at 194-198 area , however i expect this resistance to be taken down soon .. NOL could hit 2.20 soon .. watch out for it ....
i extract the following report from CIMB dated 2nd Mar 2010 ;
Maintain OUTPERFORM and target price of S$2.60; no change to earnings. NOL’s
period 1, 2010 operating statistics (six weeks from 26 December 2009 to 5 February
2010) saw a 10% sequential rise in average freight rate, the first material rise in more than a year, while demand remained strong. We believe the rise in average rate
reflects the successful transpacific (TP) emergency revenue charge from 15 January,
and possibly the re-pricing of Asia-Europe (AE) contracts. NOL is a strong beneficiary of improving TP rates, as more than half of NOL’s revenue comes from the TP. We expect successful renegotiation of the annual TP contracts come May/June to be the key re-rating catalyst. Our target price is based on a 1.8x P/BV multiple, which is based on a 20% premium to the upper limit of its 0.5x-1.5x historical trading band excluding the 2.5x reached during the super peak of 2007). Also, NOL’s virtually zero-debt balance sheet will enable it to accumulate distressed assets, if any.
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