FNArena last week noted industrial services play Service Stream (SSM) was gaining increased recognition in the market, with Perpetual Trustees (PPT) joining Richard Pratt’s Thorney group, the Lowy family of Westfield (WDC) fame and Gandel as major shareholders on the company’s register.
Service Stream has won a big NBN Co contract to the initial value of some $35m but Citi analysts, while pleased, have made no changes. Their explanation is that such contract wins had already been accounted for. From a strategic point of view, this is a clear positive, they acknowledge.
Citi analysts have made no changes following the announcement that Service Stream’s contract with the Queensland government has been extended till 2014. Current forecasts already account for such events, report the analysts.
Owning Service Stream shares has been a bit of a mixed experience over the years past and many would have sold out out of sheer impatience, but Citi analysts note the stock is up 150% since June last year. However, they also believe it’s time for a breather, hence the downgrade to Hold.