Stock Hold Call: Magnecomp Int target price of 1.46 by DMG!

DMG & Partners Securities gave Magnecomp International a "hold" rating in its initial coverage of the hard disk drive (HDD) component supplier, with a target price of 1.46 sgd. In a client note, DMG said the outlook remains positive for Magnecomp as shipments of its suspension assemblies are expected to rise after the integration of Maxtor and Seagate. However, the brokerage gave it a "hold" rating on the assumption that the market may not fully appreciate the back-end loaded nature of Magnecomp's earnings model. "We believe that Magnecomp is likely to perform in line with the HDD market but will enjoy the fillip of a consumer boom for plasma and LCD televisions. Hence, it deserves a market premium over other HDD suppliers," DMG said. At 11.10 am, Magnecomp was flat at 1.19 on volume of 1.064 mln shares.