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PLC [M-PF +9.2%] - A pure dividend play given unexciting earnings outlook - Update

We downgrade the stock to a MARKET PERFORM rating based on a +9.2% Total Return. 2016 EPS is expected to drop 39.1% due to weakness in asphalt sales volume, a cooling off in private investment into BOT projects and strained public finances that have stymied infrastructure spending. EPS should rebound by 10.6% in 2017 as infrastructure projects resume, but off a low base. The stock looks fairly priced with a 2017 PER of 10.5x and a dividend yield of 7.3%.