Eksons- a good buy at its uptrend line

Eksons is involved in the manufacture & sale of veneer, plywood & sawn timber. It is a profitable company with an EPS of about 21 sen (based on the cumulative EPS for the past 4 quarters). Based on its closing price today (July 21) of RM0.945, it is trading at a PE of only 4.5 times only (see Table below).

Eksons has recently proposed to carry out a capital repayment of 20 sen. In addition, it will be venturing into a new business i.e. property development via a JV company. The share price has dropped since these announcements, from a high of RM1.27 on June 29.

From the chart below, you can see that the stock is now at its short-term uptrend line. This would be a good entry level as the share is likely to re-bounce from the uptrend line support. If this support failed to hold, the next support will be at RM0.90. If that also failed, you should cut loss & move on.
























Chart: Eksons' daily chart as at July 20