RHB Research maintains Underperform on Masterskill, unch FV RM1.05

KUALA LUMPUR (Nov 21): RHB Research Institute is maintaining its Underperform call on Masterskill Education Group Bhd.

It said on Monday that its fair value is unchanged at RM1.05, based on a target FY12 PER of 8.5 times.

'We believe that Masterskill's lower earnings trend will continue into 1H12 as Masterskill continues to incur higher operating costs in line with its expansion,' it said.

RHB Research said although Masterskill should not be affected by the recent proposed changes to the PTPTN loans, with around 96% students taking the loans, Masterskill is susceptible to future changes in the loans.

'Furthermore, Masterskill's high foreign shareholding of 46.4% continues to expose the company to volatile portfolio flows,' it said.

Masterskill slips in early trade on weaker 3Q earnings

KUALA LUMPUR (Nov 21): Masterskill Education Group Bhd (MEGB) shares fell in early trade on Monday after its net profit for the third quarter ended Sept 30, 2011 fell 78.8% to RM5.55 million from RM26.18 million a year earlier, due mainly to lower student enrolment and higher overheads.

At 9.30am, MEGB fell four sen to RM1.16 with 429,100 shares traded.

MEGB said on Nov 18 that its revenue for the quarter fell to RM61.19 million from RM80.68 million in 2010.

Earnings per share fell to 1.00 sen from 9.00 sen a year earlier, while net assets per share was RM1.31.

For the nine months ended Sept 30, MEGB's net profit fell to RM39.72 million from RM75.29 million in 2010, on the back of a dip in revenue to RM200.67 million from RM234.83 million.

RHB Research maintained its Underperform call on Masterskill with an unchanged fair value of RM1.05, based on a target FY12 PER of 8.5x.

The research house MEGB's lower earnings trend will continue into 1H12 as MEGB continues to incur higher operating costs in line with its expansion.

'Although MEGB should not be affected by the recent proposed changes to the PTPTN loans, with around 96% students taking the loans, MEGB is susceptible to future changes in the loans.

'Furthermore, MEGB's high foreign shareholding of 46.4% continues to expose the company to volatile portfolio flows,' it said in a note Nov 21.

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CIMB Research maintains Neutral on Masterskill

KUALA LUMPUR (Nov 8): CIMB Research is maintaining its Neutral outlook on Masterskill Education Group Bhd.

It said on Tuesday that the National Higher Education Fund Corporation's (PTPTN) decision to stop giving student loans for expenses come 2013 will hit Masterskill's student intake, which was already at a historical low in July-September 2011.

'Brace for poorer 3Q results. We cut our EPS after revising our assumptions for student numbers. Though we roll over our valuation horizon, our target price falls as we now apply a target P/E of 7.6 times (8.7 times previously), based on an unchanged 40% discount to our revised target market P/E. Maintain NEUTRAL,' it said.

CIMB Research maintains Outperform on Masterskill

KUALA LUMPUR: CIMB Equities Research has lowered the target price for Masterskill Education Group Bhd from RM4.48 to RM3.48 but it is maintaining an OUTPERFORM rating while the main potential catalyst is the recovery of investor sentiment.

It said on Monday, June 27 The Edge's article highlighted Masterskill CEO and ED's comments on his health after a brain aneurysm, confirming speculation on it early this year.

'Positive surprises include (i) the operation of smart schools which are in good demand, (ii) diversification into business-related courses, and (iii) a 2012 target for the launch of its Indonesian campus.

'However, the delay in revealing the developments in the CEO's health could highlight the issue of transparency and corporate governance. In view of this, we raise our discount to our 14.5 times target market P/E from 10% to 30%, in line with our small-cap valuations,' it said.

CIMB Research said though its target price is cut from RM4.48 to RM3.48, it maintains an OUTPERFORM rating as its CY11-12 P/E of six to seven times and 9% dividend yields are attractive. The main potential catalyst is the recovery of investor sentiment.

#Flash* Masterskill files cross appeal, seeks RM100m damages from Sistem Televisyen Malaysia

KUALA LUMPUR: Masterskill Education Group Bhd (MEGB) is filing a cross appeal on the quantum of damages awarded over the visuals of its college on a TV3 news report and is now seeking RM100 million in damages.

MEGB said on Friday, May 13 that Sistem Televisyen Malaysia Bhd (STMB) had appealed against the decision of the High Court on April 28 where MEGB was awarded RM250,000.

'The plaintiff (MEGB) has instructed its solicitors to file a cross appeal on the quantum of damages awarded in order to enhance and increase the quantum to RM100 million,' it said.

To recap, MEGB won its suit against STMB over the visuals of its college on a TV3 news report about 60 colleges which had been deregistered.

On April 28, the High Court founds that MEGB's unit Masterskill (M) Sdn Bhd had successfully proven STMB during the TV3 Buletin Utama defamed Masterskill by''showing visuals of the Masterskill college.

The visuals were shown during the narration that 60 colleges had been deregistered even though this news had nothing to do with Masterskill group.

The High Court then found STMB liable for defamation''and''awarded damages of RM200,000 and costs of RM50,000 to Masterskill.

OSK Research maintains Trading Buy on Masterskill, unch FV RM3.44

KUALA LUMPUR: OSK Research is maintaining a Trading Buy on Masterskill Education Group Bhd (MEGB) at an unchanged FV of RM3.44 at 12x FY11 PER.

It said on Thursday, March 31 the stock is currently trading at an alluring FY11 PER of 6.4x, the cheapest in its coverage, with dividend yield of'' more than 7% p.a.

'With the stock's valuation at its trough, we believe that any further downside risks are unlikely and hence we see this as an opportune time to accumulate. Its key re-rating catalysts are more affirmative indications in relation to PTPTN's loan allocation and the potential approval of courses at its new Kuching campus,' it said.

Masterskill recommends 7.9 sen dividend a share for FY2010

KUALA LUMPUR: The directors of Masterskill Education Group Bhd have recommended a final single tier dividend of 7.9 sen per 20 sen share for the financial year ended Dec 31, 2010.

It said on Wednesday, March 30 the dividends would be payable on June 15.

The group had on Oct 13, 2010, completed the distribution of an interim dividend of seven sen per share to the shareholders.

The total of 14.9 sen per share dividend for 2010 will represent a total payout of 60% of its net profit, equivalent to RM61 million.