KUALA LUMPUR (Aug 6): With more jobs set to trickle in for Gamuda Bhd (KL:GAMUDA), investors should focus more on the wins than earnings delivery at the builder, said CGS International in lifting its target price to the highest on the street.

CGS International raised its target price for Gamuda from RM6.00 to RM7.30, the highest among 21 research houses covering the country’s top construction company by revenue. The new target price is nearly 26% higher than the average, and suggests a potential upside of 33% from its last price.

There would be a slew of contract awards in the next six- to 12 months, and positive headlines from the upcoming Budget 2026 to be tabled in Parliament in October, the research house noted. Further, Gamuda could capitalise on the majority of the five tenders for Google data centres in Malaysia, the house said.

“Given Gamuda’s strong execution track record, we think the market will be more forgiving in terms of earnings delivery,” the research house said. “We believe as long as it continues to build on its orderbook, the longer-term earnings trajectory will remain intact.”

On Wednesday, investors sent Gamuda to a new record high since its listing in 1992. The stock has already outperformed the broader market with a 16% gain year-to-date, as the company rides on a wave of new data centres sweeping across Malaysia, and as it secures high-profile international jobs.

The consensus is bullish with 20 “buy”, one “hold”, and no “sell” calls, according to analysts tracked by Bloomberg.

At CGS International’s latest target price, Gamuda will trade at 25 times its earnings for the year ending July 2027 (FY2027), “which we believe is justified”, given its 24% average annual growth in earnings over three years, and operations in four infrastructure markets.

Gamuda has outstanding jobs on hand worth RM37.2 billion as of June, and has won RM18.4 billion worth of new contracts since the start of FY2025. Apart from local projects, Gamuda is also expected to win one more contract in Taiwan, CGS International said.

Next year, the “pipeline looks promising,” due to its early involvement in three renewable energy projects in Australia, the house said, noting that it has also been shortlisted for railway projects in Australia, and a highway in New Zealand.