De Beers to choose new CEO . . . . Anglo American , which is due to report its full-year earnings on Friday, said it would post underlying earnings of $302m for the year from its investment in De Beers, Reuters reported, adding that Credit Suisse had said the contribution was slightly ahead of its forecast of $296m. . . . . http://www.businessday.co.za/Articles/Content.aspx?id=134240
Raises EPS to $3.02 for 2011 and $3.54 for 2012, but cuts to 'HOLD'.
Peak margins a concern — We forecast Anglo’s peak earnings at $3.55 per ADR, based on 45% EBITDA margins. This implies a “reasonable” 2012E P/E multiple of 7.7x. However, there could be downside risk to our bullish earnings, given that its 2007 peak was only $2.20 and EBITDA margins were much lower at 37%.