FaithAnchor

$ST Engineering(S63.SG)

ST Engineering (S63): Defence Spending Meets Earnings Momentum

ST Engineering’s defence story is becoming harder to ignore. Management sees an S$11bn international defence pipeline over the next 18–20 months, spanning ammunition, counter/offensive-drone systems, armoured mobility, satellite-enabled battlefield awareness and resilient local supply chains.

The fundamentals are equally compelling. 1H26 net profit rose 27.1% to S$512.1m, with revenue growth and operating leverage from sustained cost savings. Its order book reached S$34.5bn at March 2026, providing substantial earnings visibility. (ST Engineering⁠)

Technically, the setup remains constructive: the 200-day MA is around S$9.94, while MACD remains bullish. At roughly S$10.6–10.96, however, the stock is no longer cheap. FY26 estimates imply about 33x earnings, with Maybank’s S$12.50 target and consensus around S$11.58 offering further upside, but valuation leaves less room for disappointment. (TipRanks⁠)

Verdict: HOLD / BUY ON PULLBACK. Existing investors should hold; new investors should accumulate in tranches around weakness rather than chase the defence rally.

Not financial advice.

Oracle’s Jupiter is a massive AI bet, but the road won’t be smooth. Power shortages, a delayed gas pipeline, rising construction costs, huge funding needs and execution risk could pressure margins and cash flow. I’m bullish on the long-term AI demand, but Jupiter must prove it can deliver.

MediLifestyle (Z4D) surged 44% 🚀 after announcing its EM2Au acquisition. Investors are betting the deal can unlock a new growth engine and earnings upside. But after such a sharp jump, the easy money may be gone. Now, it’s execution that matters. Can Z4D deliver? 👀

$CapLand IntCom T(C38U.SG)

C38U (CICT): Strong Results, But Price Matters

CapitaLand Integrated Commercial Trust (C38U) delivered a solid 1H 2026: gross revenue rose 7.5% to S$846.8m, NPI 8.7% to S$630.5m, while distributable income jumped 13.3% to S$466.7m. DPU increased 7.1% to 6.02 cents, despite a 5.8% larger unit base. (SGX Links⁠)

Fundamentally, CICT remains defensive: occupancy was 95.6%, retail/office rental reversions were +4.0%/+6.5%, gearing improved to 37.4%, and interest coverage strengthened to 3.9x. Paragon, acquired in July, provides an additional growth catalyst. (SGX Links⁠)

Valuation is the sticking point. At around S$2.43, annualised DPU of ~12.04 cents implies roughly a 5.0% yield, while NAV is S$2.15—meaning units trade at about 1.13x NAV. Analyst targets cluster around S$2.69–S$2.80, offering moderate upside. (Beansprout⁠)

Technically, C38U remains constructive: RSI was neutral at 55.8, MACD positive, with price above its 20-, 50- and 200-day moving averages. (TipRanks⁠)

Verdict: Invest in tranches, not chase. Consider an initial 30–40% position around S$2.40–2.45, adding on weakness toward S$2.30–2.35. The fundamentals justify ownership, but valuation limits the margin of safety.

Not financial advice.

NVDA cutting its OpenAI bet from $250B to $120B—panic or strategy? I’d hold. Nvidia may be seeing something retail can’t: AI demand is bigger than one customer. The real game is infrastructure dominance.

$Wilmar(F34.SG)

Wilmar International: Hold, With Indonesia the Key Risk

Wilmar’s vertically integrated agribusiness—from plantations and crude palm oil (CPO, the unrefined palm oil extracted from fresh fruit bunches) to refining, food products, feed, oleochemicals and biodiesel—provides earnings diversification. Its Feed & Industrial segment remains an important profit contributor, while integrated sourcing can cushion commodity volatility. (Wilmar International⁠)

However, Ukraine and Middle East tensions could lift energy, grain and fertiliser costs, pressuring plantation and processing margins. Indonesia presents the larger structural risk. Its Domestic Market Obligation (DMO) requires palm-oil producers/exporters to allocate supply to Indonesia’s domestic market, supporting cooking-oil availability and prices rather than exporting the full volume. (Setkab⁠)

More importantly, Indonesia raised the CPO export levy to 12.5% from 10% in March 2026, increasing the cost of exporting palm oil and helping fund biodiesel subsidies. (Oils & Fats International⁠) Wilmar also faces heightened regulatory scrutiny, including a 2026 Indonesian probe into suspected export under-invoicing. (The Business Times⁠)

Investment view: HOLD. The diversified business supports resilience, but policy uncertainty caps upside. Existing investors should hold and collect dividends; aggressive investors can add on meaningful pullbacks, rather than chase strength. Trim only if Indonesian regulation materially erodes margins or technical momentum breaks down.

Not financial advice.

$Centurion(OU8.SG)

Centurion: Profit Shock or Buying Opportunity?

Centurion Corp (OU8) fell 5.9% to S$1.60 after H1 2026 net profit plunged 64% to S$26.5m. The headline looks alarming, but the decline is largely accounting-driven: fair-value losses widened to S$32.8m, including S$19.1m of stamp duties related to Centurion Accommodation REIT (CAREIT), while a S$4.2m loss from associates also weighed on earnings. Revenue, however, rose a strong 31% to S$184.9m. (The Business Times⁠)

Fundamentally, this is more resilient than the headline suggests. DBS forecasts FY2026 revenue of S$356m and earnings of S$97m, with a S$1.86 target price versus S$1.60 currently—about 16% upside. Valuation at 12.1x FY2026 P/E is reasonable, though earnings remain sensitive to property valuations. (DBS Singapore⁠)

Technically, S$1.53–1.50 is the key support zone; a break below could signal further downside. Conversely, reclaiming S$1.66–1.70 would improve momentum.

For CAREIT (8C8U) investors, the key point is that Centurion’s accounting loss does not automatically threaten CAREIT’s rental distributions. CAREIT’s 2026 forecast distributable income was S$113.7m, equivalent to 7.47% yield at IPO assumptions. (eServices⁠)

View: Hold, selectively buy the dip rather than trim aggressively. Income-focused investors should prioritise CAREIT’s cash-flow and DPU coverage, while OU8 investors can accumulate gradually below S$1.55, provided property valuations and leverage remain controlled.

Not financial advice.

ST Engineering down ~3%! 🚨 Profit-taking after rich valuations, or the first warning on margin compression? Either way, dividend seekers may see this dip as an opportune entry—if earnings remain resilient. 👀

$Vertiv(VRT.US)

Vertiv: The “Utility” Behind AI Data Centres

Vertiv $Vertiv(VRT.US) is increasingly becoming a mission-critical picks-and-shovels play on AI. Q2 2026 revenue rose 24% to US$3.27bn, adjusted EPS surged 60% to US$1.52, while FY2026 guidance implies 31% organic growth and US$6.65–6.75 adjusted EPS. (Vertiv Investors⁠)

Hyperscalers increasingly treat power distribution, UPS and liquid cooling as essential infrastructure—not optional equipment. Vertiv’s liquid-cooling leadership and Nvidia relationships give it a strong position as rack densities rise. It competes closely with Schneider Electric and Eaton, while also facing SMCI and specialised cooling players. Vertiv leads in data-centre HVAC and ranks among the leaders in liquid cooling. (Global Market Insights Inc.⁠)

The concern is valuation. Simply Wall St’s April model estimated fair value around US$260, versus US$307, with VRT trading at a substantial premium to industry and peer P/E multiples. (Simply Wall St⁠)

Technically, momentum has weakened: MACD turned negative and RSI approached the high-30s/40s, while price fell below key moving averages after July’s earnings sell-off. (Investing.com India⁠)

Options: short term, favour cash-secured puts below US$250–270 rather than chasing calls. Longer term, covered calls around US$320–350 can monetise volatility while retaining upside. The thesis remains bullish, but valuation demands disciplined entries.

Not financial advice.

Coherent’s Q4 revenue reached $2.05B, reflecting strong demand from AI and data centres. The growth looks sustainable for now, but rising capacity and energy use remain key areas to watch as expansion continues.

1B 2B 3B

Inflation looks softer than June, with core CPI easing and monthly momentum contained. A dovish signal for markets, but sticky headline inflation remains a risk.

$Airbnb(ABNB.US)

Airbnb $Airbnb(ABNB.US) has delivered a quarter that materially strengthens the bull case. The Business Times highlighted robust travel demand and the 2026 World Cup catalyst; Q2 revenue jumped 17% YoY to US$3.61bn, EPS rose 33% to US$1.37, while nights/seats booked increased 10% to 148.3m. Management lifted FY2026 revenue growth to mid-teens and expects adjusted EBITDA margin of at least 35.5%.

Fundamentally, AI-driven conversion and customer-service efficiencies, alongside hotel supply growing nearly 3x faster than home listings, broaden Airbnb’s TAM. Wedbush upgraded to Outperform with a US$200 target, while Benchmark raised its target to US$180.

Valuation remains the caveat: ABNB previously traded around 28–30x forward earnings, above traditional travel peers. After the earnings surge toward US$176, the margin of safety has narrowed.

Technically, the breakout above the US$147.25 base is bullish, but the ~16% one-day surge risks near-term overextension. Entry: wait for a pullback toward US$160–165 rather than chase. Options: cash-secured puts around US$155–160 offer a better risk/reward; bullish investors could consider a US$165/190 call spread to cap premium risk.

View: Bullish fundamentally, tactically cautious.

Not financial advice.

MTI raises Singapore’s 2026 GDP forecast to 4.5–5.5%, powered by the AI capex wave. Strong momentum, but concentration is a risk. Singapore may need to diversify beyond AI-led manufacturing before the cycle turns.