Singapore's Best Stock Rises From the Ashes of Uber's Demise
(Bloomberg) -- It’s been a heck of a ride for ComfortDelGro Corp.
In a little over seven months, Singapore’s largest taxi company has reversed course from the city-state’s second-worst performing stock to its best, as competition for passengers eased following Uber Technologies Inc.’s exit from Southeast Asia.
ComfortDelGro has rallied 20 percent this year, against the benchmark Straits Times Index’s 2.2 percent decline. The company’s shares rose 4 percent on Wednesday to close at S$2.37 in Singapore.
Uber’s departure has left rival Grab as the only major private-car hire service provider competing for Singapore customers against ComfortDelGro.
Looking ahead, analysts see ComfortDelGro’s prospects brightening as the Singapore market stabilizes and the firm continues to expand abroad. Last month, ComfortDelGro bought out an automobile repair service in Australia, started a driving-school joint venture in China and acquired a charter bus company. This week, it announced the purchase of an Australian bus operator for S$111.1 million ($81 million).
“The worst is over for them,” said Joel Ng, an analyst at KGI Securities Pte. He sees the company “back to growth mode rather than being on the defensive.”
The stock hasn’t had a sell rating since May, a feat it last pulled off in September 2016. It has 12 buy ratings and 5 hold recommendations, data compiled by Bloomberg show. ComfortDelGro is scheduled to report second-quarter earnings on Aug. 10.
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