Nrw Holdings Limited

( ASX:NWH ) - ASX200 Capital Goods


Mining Hits The Growth Cliff

On Wednesday the Australian Bureau of Resources and Energy Economics said 51 mineral projects, 18 gas and petroleum projects and 18 infrastructure projects worth $268 billion had been approved. Of the 87 projects, 11 mega projects worth more than $5 billion each, account for an aggregate $200 billion or 75 per cent of the total committed project value.

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Analyst Views

NWH – Citi rates the stock as Buy

The company has now won major contracts at Koodaideri and Eliwana. While the combined value is only $104m, Citi is more confident in its FY20 forecasts as a result, as this positions the company to win subsequent work from all three major iron ore producers in the Pilbara.

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NWH – Credit Suisse rates the stock as Neutral

The interim earnings were 9% below the broker’s forecast. Credit Suisse observes the margins were affected by the late ramp up of key projects and low levels of Drill & Blast rig utilisation. The broker maintains a Neutral rating, believing the stock is potentially interesting if it can address the FY16 earnings hole, where Credit Suisse expects a 33% decline.

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