|
Yangzijiang Shipbuilding's (YZJ) stock is +7.5% year-to-date (at $3.74), partly after it went x-dividend of 20 cents/share. |
| CGS: Strategic Acquisitions and Steady Margins |
CGS International maintains a target price of S$4.95, which is based on an 11x FY27F P/E — a valuation that still represents a 30% discount to its global peers.
|
YANGZIJIANG |
|
|
Share price: |
Target: |
A primary driver for this target is YZJ's unshakeable orderbook and strategic expansion.
The analysts Lim Siew Khee and Megan Kande highlight that Yangzijiang's US$4.5 billion order target for 2026 remains intact, as it successfully capitalizes on strong enquiries for oil and chemical tankers to offset cyclical headwinds in the containership market.
Furthermore, overall yard capacity is set to increase by 17% with the Hongyuan yard starting operations in 2H2026.
CGS analysts are also optimistic about YZJ's recent 10% stake acquisition in Poseidon, the holding company of Seaspan, noting that it will secure future orders and be mildly accretive to earnings.
They state: "Earnings upside could come from higher equity accounting of Poseidon and revenue uplift from Hongyuan. We think the current share price weakness presents buying opportunity with catalysts from stronger-than-expected order wins".
"We like YZJSB for its strong execution and yield (5.8%)".
| UOB KH: Unprecedented Visibility and Bullish Markets |
UOB Kay Hian's target price of S$4.75 is rooted in a 10x target PE multiple, which analyst Adrian Loh notes is 2SD above the company’s 10-year average of 6.2x.
|
YANGZIJIANG |
|
|
Share price: |
Target: |
This premium is heavily supported by YZJ's exceptional revenue visibility and flawless execution.
By the end of Q1 2026, YZJ had secured a colossal US$22.3 billion orderbook spanning 252 vessels, providing revenue visibility straight through to 2030.
UOB Kay Hian emphasizes that this orderbook is being executed efficiently, with the firm achieving 29% of its 2026 delivery target in just the first quarter.
Macroeconomic tailwinds are also playing a significant role in their valuation. Geopolitical disruptions, specifically the Iran war and the effective closure of the Strait of Hormuz, have acted as a major catalyst, sending the ClarkSea Index to a three-year high.
UOB notes, "Shipping markets ytd in 2026 have significantly outperformed the same period in 2025, driven by geopolitical disruptions".
| Newbuild talks |
 "In its presentation and during the analyst briefing, management stated that newbuild discussions were slower due to geopolitical tensions; however, contracts in advanced negotiations remain unaffected, and order cancellations are highly unlikely."-- Adrian Loh, analyst |
Moreover, the analyst sees further upside from YZJ finishing construction on two Liquefied Natural Gas Carriers (LNGCs) and maintaining a sustainable dividend payout ratio of 50%.
The analyst says: "In our view, the company’s 2026F PE and EV/EBITDA multiples appear inexpensive at 8.2x and 5.0x respectively, especially given that it delivers a robust 2026 ROE of nearly 28% and well above that of its Korean peers".
He concludes: "With the orderbook now at nearly US$22.3b across 252 vessels, YZJ retains strong revenue coverage into 2029, supported by its robust shipbuilding margins over at least the next two years".
Both analyst reports paint a picture of a company firing on all cylinders. Whether it is CGS focusing on steady margins, capacity uplifts, and the Seaspan partnership, or UOB Kay Hian highlighting execution speed, LNG upside, and a bullish macro environment, the consensus is clear: Yangzijiang is well-positioned to ride the current maritime boom. |
→ See also:NAM CHEONG: 70% of Fleet on Long-Term Charters, Analyst Target Prices At 10-11x PE
