What’s next for Genting Singapore shares?

• Genting Singapore Limited (SGX: G13) share price closed 2% lower on Tuesday (19 July 2022)
• The stock appears to have stabilised, following a spike last Friday
• UOB analysts kept a ‘buy’ call and price target of S$1.08 on the group earlier this month
• Keen to trade Genting Singapore shares? Open an account with us to start today.

Genting Singapore stock price: what’s the latest?

Genting Singapore shares fell further on Tuesday, a day after the hospitality group responded to queries regarding a potential sale of the company.

The stock jumped up over 9% last Friday (15 July 2022), after it was reported that several casino operators and hospitality groups, including US chain MGM Resorts International, have expressed interests to acquire the company.

The company has said that it ‘is not aware of nor has it been party to any ongoing discussions concerning any potential transaction’, in a bourse filing posted on Monday in response to the Singapore Exchange Securities Trading Limited’s queries on the unusual price movements in its shares.

‘Further to enquiries made by the company of its directors and senior management pursuant to the queries from the SGX-ST, Tan Sri Lim Kok Thay, the Executive Chairman and indirect controlling shareholder of the company, has informed the company that he is aware, by virtue of his position as Executive Chairman and Chief Executive of Genting Berhad, that Genting Berhad had received an unsolicited approach for its shareholding in the company, which has not been pursued,’ the company added.

Genting Singapore added that it is not aware of any information not previously announced concerning the company, its subsidiaries or associated companies, which might explain the trading on 15 July 2022.

How do analysts view Genting Singapore?

Takeover interests aside, the stock is down slightly on a year-to-date basis.

In terms of outlook, analysts have a consensus rating of ‘neutral’ and an average price target of S$0.92, based on the latest SGX StockFacts data.

The price target equates to an 18% upside potential from its last traded price of S$0.78.

The latest call came from UOB’s equity research team, who maintained a ‘buy’ call and price target of S$1.08 on 4 July 2022.

UOB’s bullishness is predicated on the fact that the market ‘will eventually price in’ the company’s 2022 to 2023 recovery.

‘Genting Singapore is a major direct beneficiary of Singapore’s Covid-19 national vaccination programme and reopening of the economy. We believe that valuations will partially factor in Genting Singapore’s return to pre-pandemic earnings dynamics,’ the analysts wrote.

The analysts also expect the company’s dividend yield to normalise to 4.7% in 2023, assuming revenue and cash flows recover back to pre-pandemic levels, and that its 2019 dividend payout level of S$0.04 is restored.

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