China Natural Gas "buy," target price reduced

05/16/07 - Brean Murray, Carret & Co

NEW YORK, May 16 (newratings.com) - Analyst Julie Chen of Brean Murray maintains her "buy" rating on China Natural Gas Inc (CHNG), while reducing her estimates for the company. The target price has been reduced from $5 to $4.

In a research note published this morning, the analyst mentions that the company has reported weak 1Q07 results, short of the estimates. China Natural Gas’ CNG capital expansion project has been delayed on account the availability of cash in hand, the analyst says. The EPS estimates for 2007 and 2008 have been reduced from $0.48 to $0.39 and from $1.25 to $1.12, respectively, to reflect a delay in the completion of three CNG retail stations.