Century has just announced its results for QE30/6/2010. Its net profit jumped 14% q-o-q or 79% y-o-y to RM7.5 million while its turnover increased by 26% q-o-q or 60 % y-o-y RM75 million. The better performance is simply attributed to increased business from new & existing customers.
Table: Century's last 8 quarters' results
Chart 1: Century's last 17 quarters' results
Valuation
Century (closed at RM1.66 yesterday) is now trading at a PER of 4.3 times based on last 4 quarters' EPS of 38 sen. Before we get too excited about this low PER, we must remember that the stock has traded at equally low trailing PER in the past (such as 3-4 times in the middle of 2008). Notwithstanding this, I believe that Century is very attractive.
Technical Outlook
The stock is trapped between a long term downtrend line and an intermediate term uptrend line; forming a triangle (ABC). The upside breakout level is at RM1.65-67. A few indicators seem to point towards that possibility.
Chart 2: Century's daily chart as at August 12, 2010 (Source: Quickcharts)
Conclusion
Based on good financial performance and attractive valuation, Century could be a good stock for long-term investment. However, those who are technical inclined would like to wait for an upside breakout at RM1.65-67 before venturing in for a trade.
23 comments:
hi alex,
i noticed Century went through rights issue last time. Seems like its financials has improved.
what is your view on Genting? It just broke its RM8 resistance mark. :)
thanks
maxwealth88
Hi Alex,
Morning, may i know can Gadang go any more higher than now?
Any news from Gadang & what is the resistance now?
thanks.
hi alex. can u comment on TEJARI ?? Thx alots
Hi Alex, would like to know your point of view on evergreen and SPSetia
Kind regards,
Jeremy
Hi MaxWealth88
Genting is benefiting from Genting SP recording a good set of result. Chartwise, it may be on the way to test its next resistance at RM8.50 & then RM9.00.
Hi @h Tong
I did not hear any news on Gadang. The stock is in an medium-term uptrend & that uptrend appears to be swinging upward. It may accelerate but break above the strong resistance of RM1.00-1.02. If it can do that, it may go to the next resistance at RM1.20.
hi wong
TEJARI is caught in an ascending triangle, with the upside breakout level at RM0.30-31. The indicators are pointing towards that direction but there is no breakout yet.
If it can break above the RM0.30-31 level, its next resistance is at RM0.35-36 & then RM0.40-41.
Hi jeremy tan
My technical take on:
1) Evergreen is still in an uptrend line with support at RM1.43-45.
2) SPSetia may have broken above its medium-term downtrend at RM4.10-15 in July. My guess is it may only rally once it has cleared its strong horizontal resistance at RM4.40-4.50. However the stock did not rally but merely traded sideway. SPSetia is a conundrum. A stock with a chart that looks nit & proper- a technician's dream chart. However, if you have been tracking the stock as long as I did, you will realize that the stock has very strange trading rhythm. It can be quiet for many hours in a day & relatively quiet for a few days in a roll. When the trades come, they are very lumpy. All in all, SPSetia is a stock that I am very weary of.
Hi Alex,
Thanks for you insights.
I have been monitoring SPSetia for quite sometime already and like what you have said it has strange trading patterns and i am getting weary of it as well.So far, it seems pretty well supported above its medium-term downtrend line. I do hope it stays above that because i went in at RM4.15. I guess we will have to wait for its quarterly results in october before we see further uptrend from this counter.
As for Evergreen, i heard that they will be releasing the quarterly report by next week. Sounds quite promising.
Kind regards,
Jeremy
Hi Alex,
pls comment on sunway,currently still a good entry point?
Thanks
HI Alex,
Is Guanchg a good stock to pick ?
TQ
Hi Alex,
kindly advice consumer stock, such as Mamee, F&N, CI Holding. At current price, the counters offer good price for mid term investment.
Very best regards,
AL
Dear Alex,
May I know your comments on UKB and DXN and DRBHCOM?
Thanks!
hi,alex.how do you think about tmclife company?can you pls give some comments?
Hi Pan
Sunway is on the buy list of many research houses. Alas, it never seems to live up to its potential.
The good entry level is RM1.50-55. Its next resistance is at RM1.75 & then RM1.95.
Hi cheer
I almost posted on Guanchg when its results for QE30/6/2010 was announced. The results was fantastic with net profit of RM19.7 million chalked up on the back of a turnover of RM269 million. How much of this was due to the company's ability & how much was due to blind luck as the price cocoa went skyhigh in the past few months. We saw the same phenomenon among the gold retailers, such as Poh Kong in 2007 when gold shot up. If you are sitting on cheap inventory, you would enjoy a one-time exceptional gain which may never recur again for many years.
Since 2004, Guanchong's average quarterly EPS is about 1.53 sen (excluding last quarter's EPS of 8.22 sen) or 1.83 sen (including the last quarter's results). Based on yesterday close of RM1.42, Guanchong is trading at a PER of 19-23 times. That's too high for my taste!
Hi Ai Ling
Mamee, F&N & CI Holding are good companies. However at the current price, these counters may not give very good return on your investment. To get better return, you should select stocks of good companies which have not risen too much. A good example would be Genting Malaysia Bhd (a poor performer) as compared to Genting Bhd (a good performer).
Hi steve
My technical takes are:
1) UKB is pressing against a strong resistance of RM1.30.
2) DXN is up against the strong resistance of RM1.00.
3) DRBHCOM will face strong horizontal resistance at RM1.00. It's still in a long-term downtrend with the downtrend line at RM1.45.
Check out the financials by going to Bursa website.
Hi hidalgo12
TMClife rallied sharply in the past few days. Its immediate resistance is at RM0.55 and then RM0.60. Its all-time high is at RM0.73.
TMClife may be attracting some interest from investors as it has a new hospital, the Tropicana Medical Center. Prior to this, it only provides fertility treatment which is a small niche market, albeit a lucrative one.
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