DST Systems, Inc. : Benefit from the upper slant
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08/21/2012 | 08:40am
Opinion : Bullish above 49.72 USD
Target price : 56 USD
Stop loss: 47.9 USD
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NYSE
IT Services / Consulting |
DST Systems, a software development firm specialized in information processing and management, with the goal of improving efficiency and customer service, might rebound on the significant threshold currently tested.
From a fundamental viewpoint, the company shows positive information with an estimated PER of 9.78x for the current year. Furthermore, the EV/Sales ratio is 1.74x and it confirms the low valuation. Revenues and operating margin growth rates add relevance to this investment.
Technically, the security is in a consolidation area limited by the significant upper slant and the USD 56 resistance. The latest downtrend pushed the security upon contact the support at USD 49.72, which could stop the bearish trend of these last days.
Ideally, investors will take a long position nearby the support currently tested in order to benefit from a technical rebound. The USD 52.8 is the first goal before aiming towards USD 56.
This strategy should be covered by a stop loss placed under the USD 49.72 support because a breakdown of this level would invalidate it.
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Valuation |
2013e |
2014e |
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PER (Price / EPS)
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14,8x |
14,5x |
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Capitalization / Revenue
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1,60x |
1,58x |
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EV / Revenue
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2,00x |
1,86x |
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EV / EBITDA
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8,93x |
7,94x |
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Yield (DPS / Price)
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1,27% |
1,27% |
| Profitability |
2013e |
2014e |
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Operating Margin (EBIT / Sales)
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15,2% |
15,9% |
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operating laverage (Delta EBIT / Delta Sales)
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2,41x |
3,86x |
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Net Margin (Net Profit / Revenue)
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10,7% |
10,6% |
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ROA (Net Profit / Asset)
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5,20% |
5,70% |
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ROE (Net Profit / Equities)
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16,2% |
15,4% |
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Rate of Dividend
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18,8% |
18,3% |
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