Service Stream likely NBN contractor
Customer care and special field services provider Service Stream Limited (ASX: SSM) is seen as a very likely participant in the National Broadband Network project.
Within a fortnight, share prices in Service Stream jumped 31 percent to 38 cents. Citi analyst Christopher Vagg is confident the stock is worth up to 50 cents due to “greater than expected opportunities in metering and broadband.” Austock analyst Heath Andrews also considered the company as “an attractive takeover target, and as large NBN contracts are awarded, it stands to be rerated.”
However, Service Stream chief Graeme Sumner said, “We don't need acquisitions to grow... There's plenty of demand (for our services) for us to grow organically and it's cheaper than buying another business.”
The former Transfield's New Zealand chief has been handling the top post at Service Stream for about nine months. His first set of full-year results showed a loss of $2.6 million but Sumner vowed to win back investor confidence after the group was forced to take writedowns of $20 million.
According to Sumner's plan, the company will be concentrating on a three-pronged growth strategy that will target environmental services, mobile infrastructure, and fixed-line broadband services.
The company is into smart meter installation, and solar panel and solar hot water installation programs as a rising number of households equip themselves with environmentally friendly energy sources.