Hartleys slashes VDM’s price target

As the mining services sector kicked back into gear, analysts at Hartleys identified VDM Group as a company that should not only benefit from the rebound, but represented good value on a forward-earnings estimate basis.

However, forecasts are just that and when VDM said in mid-November that its profits were expected to fall short of those achieved in fiscal 2010, its share price fell. Of further concern were management’s comments that the carrying value of goodwill pertaining to its consulting division, which currently stood at approximately $22 million, would have to be reassessed.