Scicom drifting down to its uptrend line

Scicom is involved mainly in the provision of business process outsourcing services. The financial performance has been improving since its listing in September 2005 with its quarterly turnover almost doubling from RM14.3 mil in QE 30/9/05 to RM27.6 mil in QE 30/9/06. Net profit has more than doubled from RM1.5 mil to RM3.2 mil during the same periods. See the table below.




Scicom's share price has been rising steadily from a recent low of RM0.345 on June 12, 2006 to a high of RM0.665 on October 31. The sharp rise coincided with a 1-for-1 bonus issue that was complated in October. Since then, the share price has been drifting down & it may soon test its uptrend line support at RM0.53 (& rising). This would be a very good level to make your entry into Scicom. See the daily chart below.



Based on a theoretical entry price of RM0.53 & the full year's EPS of 5.04 sen (based on the latest EPS of 1.26 sen for QE 30/9/06), Scicom is trading at a PE of 10.5 times. That's quite attractive for a stock that is enjoying such a strong growth.