Atlan Holdings Bhd ('Atlan')is an investment holding company whose subsidiary companies are involved in wide arrays of business. The company has three core business activities:
* Property Investment and Development
* Hospitality and Lifestyle
* Travel Retailing (via, duty free shops)
* Manufacturing
Recent Financial Results
Atlan has just announced its results for QE28/2/2010. Its net profit increased by 111% q-o-q to RM26.1 million on the back of a 12%-increase in turnover to RM204 million. The continued growth in both top-line & bottom-line was attributable to better performance for the Duty Free & Manufacturing Segments. As compared to the previous corresponding quarter (QE28/2/2009), the net profit soared almost 19 folds from a low base of RM140k. The low net profit was attributable to forex losses suffered in that quarter.
Table: Atlan's last 8 quarterly results
Chart 1: Atlan's last 8 quarterly results
Valuation
Atlan (closed at RM3.38 yesterday) is now trading at a PER of 8.7 times (based on FYE28/2/2010 EPS of 39 sen). If Atlan can maintain its healthy growth in the past 2 quarters, we may see higher EPS for FY2011. Based on a PER of 10 times, Atlan's fair value is about RM3.90, giving a potential upside of 15%.
Technical Outlook
The long-term chart for Atlan shows a stock that is trapped within a symmetrical triangle, comprising an uptrend line that stretches back to 1998 & a downtrend line that stretches back to 1996-97. The uptrend line support is at RM2.50, while the 2 possible downtrend lines' resistance is at RM3.70 or RM4.05. Its immediate horizontal resistance at RM3.40 & RM3.20.
Chart 2: Atlan's monthly chart as at April 1, 2010 (Source: Tradesignum)
Others Comment
In an earlier post, I pointed out Atlan's overly aggressive share buyback program undertaken as well as its rather fanciful chart. The earlier comments would be my main reservation about this stock. However, its strong point would be its healthy growth & fairly reasonable valuation, which could lead to a steady rise in its share price.
Conclusion
Based on improving financial performance and reasonable valuation, Atlan could be a good stock for long term investment. Technical outlook is however neutral as the stock is likely to trade between RM2.50 & RM3.70 until a breakout has been achieved.
5 comments:
hi alex. can comment on MBFHLDG after GO fair? can buy at current level?
Hi Wong,
MBfH is a very diversified conglomerate with subsidiaries involved in credit card, car dealership & plantation. For FYE31/12/2009, it reported a net profit of RM112.6 mil on turnover of RM1.897 billion. However, its performance was boosted by non-recurring income of about RM66 mil (the bulk of which came from write back of RM61 mil on debts and interest). The adjusted EPS for FY20009 is about 8 sen. At yesterday price of RM0.625, MBfH is trading at a PER of about 8 times. This is quite reasonable, with room for an upside of 20%.
Chartwise, it may have broken above its downtrend line that stretches back to 2003. The resistance of that downtrend line (now, a support) is at RM0.61-62.
The failed Privatization of MBfH by way of a proposed Selective Capital Reduction and Repayment exercise (‘SCR’) at RM0.65 per MBfH Share could be used as a benchmark of the fair value of this stock.
Finally, the company has just proposed a 10 sen dividend less 25% tax.
All in all, I think the stock could be a good BUY at present price (of RM0.67).
http://announcements.bursamalaysia.com/EDMS%5Cedmsweb.nsf/LsvAllByID/BE31CA39B31BB1EC4825771200182EB4?OpenDocument
How your view BJtoto? Major shareholder keep on buy the shares.Seem like going to have good annoucement
Hi Seng Khoon,
BJtoto's major shareholder (Vincent Tan) has been trading (i.e. buying & selling) the stock over the past few months. In the past 2 weeks, he or his companies were buying but there were more selling in the earlier part of April. In February & March, there were high volume of buying & selling done by VT & his companies. So, it is hard to tell whether he is a net buyer or seller over the past 3-4 months.
Chartwise, BJToto is now testing its horizontal resistance at RM4.50. The next resistance from the medium-term downtrend line is at RM4.60. Because of the close proximity of these resistance, BJToto is not an interesting prospect for a trade.
Dear Alex,
Your observation on "VT" is excellent! Of course he is well known in the 'trading' over the years. So we must be very cautious to trade most of the bj-related shares. If we ride its momentum timely and correctly, we may make some substantial profits ! But we have to open our eyes widely.
Thank you for your comments.
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