SISB Public Company Limited (SET: SISB) rose as much as 4.2% to its four-month high on Monday as investors are speculating that the company will continue making a new high in 4Q23, 2023 and also 1Q24.
The share price of only school stock in the Thai stock market rose as much as 4.2% to THB37.25 per share intraday and is now trading slightly lower at THB37.50 per share, up 3.50%.
Tisco Securities wrote in its research paper that it expects to see robust earnings growth in SISB, supported by expansion of existing branches and full-year recognition of revenue from new branches as both could be all-time highs.
Moreover, Tisco Securities also revised its estimates upwards to reflect an increase in the number of students and average tuition fees with a 2-year CAGR at 30%.
4Q23 earnings are expected to rise both YoY and QoQ to 203 million baht with a support by higher-than-expected student enrollment, tuition fees and full-quarter revenue recognition after the start of a new semester in August. This would push 2023 net profit to rise 75% to 646 million baht, which is 4% higher than Tisco’s previous expectation. Additionally, net profit margin should expand to 36.2% for 4Q23 and to 33.6% for 2023 from 27.6% in 2022.
Tisco Securities expected 1Q24 net profit to increase YoY and QoQ on the back of expected increase in student numbers, while costs, mainly for staff and teachers, should rise less than revenue growth.
Net profit for 2024-25 has been revised up to 885 million baht (+32%) and 1,087 million baht (+27%), respectively, with more enrollment from SISB’s new branches.
Tisco Securities gave a BUY recommendation on SISB with a new target price at THB42.50 per share, up from THB39.50 previously.