SGH shares rise after RBC Capital initiates outperform rating on Crux announcement
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The news: Shares in SGH rose in afternoon trade after RBC Capital Markets analyst Nicholas Daish initated coverage with an “outperform” rating on the company, noting that the value of Crux gas project appears to “underestimated”.
The numbers: Shares had risen 2.23% to $41.10 at 2:12pm AEST.
The context: Daish set the price target for the stock at $47, noting that SGH trades at a discount to its competitors.
He highlighted that RBC expects an upcoming announcement on Crux, in which the company holds a 15.5% stake, will provide backfill volume for the Prelude Floating LNG terminal, which will act as a positive catalyst for the stock.
He expects the project to commence gas production in late 2028, reaching full capacity by FY30 and generating between $350 million and $375 million in annual earnings for SGH.
The source: RBC Capital analyst note
