Analabs Resources Berhad ('Analabs') is an investment holding company, which is involved mainly in the recovery and sale of recycled products primarily in Malaysia and Singapore. One of its subsidiaries, Coveright Surfaces is involved in the manufacturing and sale of resin impregnated papers. (Note: My first post on this stock was in March 2010 but the stock did not sizzle.)
Recent Financial Results
Analabs has just announced its results for QE30/4/2011, where its net profit jumped 104% q-o-q or 91% y-o-y to RM7.1 million while its turnover was up 9% q-o-q but declined by 2% y-o-y to RM36 million. The company attributed its improved bottom-line to higher turnover and/or higher sale of better margin products, i.e. resin impregnated papers.
Table 1: Analabs's last 8 quarterly results
Chart 1: Analabs's last 18 quarterly results
Valuation
Analabs (closed at RM1.59 yesterday) is now trading at a PE of 5.3 times (based on last 4 qaurters' EPS of 29.8 sen). At this PE multiple, Analabs is deemed fairly attractive.
Technical Outlook
Analabs is still in an uptrend line, with support currently at RM1.60. It broke above its medium-term downtrend line at RM1.55-1.57 in May but the stock only enjoyed a short-lived rally to RM1.70 before retreating back to its uptrend line.
Chart 2: Analabs's weekly chart as at June 28, 2011 (Source: Quickcharts)
Conclusion
Based on improved financial performance, attractive valuation & positive technical outlook, Analabs is a good stock for medium to long-term investment.
2 comments:
Hi, Alex. I am also interested in this stock. I wish to ask you a question. Do you think that Analabs would able to continue performing as good as its quarterly ended 30 April 2011?
Thanks.
Hi LuPorTi
I think so. Analab's business is fairly stable and may sustain fairly well even in an economic slowdown. However, the share price may suffer as investors' sentiment would be less bullish.
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