Analysts give thumbs-up to EPCO, CSL

Finansa Securities said in a recent research note that Eastern Printing (EPCO) is ideal for dividend seekers because the stock pays over 10 per cent on average.

EPCO has also launched a treasury stock programme for financial management purposes, which should directly benefit its shareholders. It is purchasing up to 8 per cent of its shares from the open market until November 22 at a total cost not exceeding Bt87 million.

The scheme is expected to lift its stock price as well as its return on equity, earnings per share, book value per share and debt per share.

The brokerage said the stock buyback programme would keep the dividend yield above 10 per cent for the next five years.

Finansa suggests "buy" on EPCO with a target price of Bt3.

Phillip Securities forecasts that EPCO will pay a 15.26-per-cent dividend or Bt0.29 per share this year based on a pay-out ratio of 90 per cent and price-to-earnings ratio of 10.

EPCO has sued a borrower for bankruptcy and damages of Bt400 million. The company can ask the Revenue Department for a tax allowance for two years. The case is expected to be decided this year.

Phillip Securities also upgraded the company's revenue growth target from 6 per cent to 10 per cent or Bt758.74 million, thanks to new customers and lower paper costs. EPCO's net profit is now forecast to grow 10.17 per cent to Bt167.09 million.

Padon Vannarat, an analyst at Finansa Securities, said CS Loxinfo (CSL) is another good dividend stock because it yields 10 per cent a year on average.

The company also paid an extra dividend of Bt0.75 a share by reducing the par value of a share from Bt1 to Bt0.25, he added.

Ayudhya Securities said in its research note that CSL had not amortised goodwill from its investment in subsidiaries of Bt20 million in the first quarter. This led Ayudhya to revise upward CSL's net-profit forecast by 10 per cent to Bt319 million.

From the goodwill amortisation and its policy to always pay high dividends, CSL should pay a semi-annual dividend of Bt0.49 per share for a yield of 12 per cent per year.

Ayudhya Securities recommends a "buy" for CSL stock with a fair price of Bt5.

S Pack & Print and PICO Thailand are also expected to be good dividend payers according to their policies.