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Wednesday, July 25, 2012

PWRoot- Time to Power Up!

Results Update

PWRoot has just announced its results for QE31/5/2012. Its net profit increased by 77% q-o-q or 35% y-o-y to RM7.8 million while revenue rose 21% q-o-q or 40% y-o-y to RM71 million. The company attributes its better performance to increased sales to oversea markets.


Table: PWRoot's last 8 quarterly results

The chart below shows a company whose revenue is soaring while maintaining its profit margin. That's a commendable performance.




Chart 1: PWRoot's last 16 quarterly results

Valuation

PWRoot (at RM0.72) is now trading at a PE of 11 times (based on last 4 quarters' EPS of 6.5 sen). At this PE multiple, the company is still deemed attractive due to its steady growth.

Technical Outlook

PWRoot has just broken above its horizontal resistance at RM0.70. With this breakout, the stock may continue its steady rise.


Chart 2: PWRoot's weekly chart as at July 24, 2012 (Source: Quickcharts)

Conclusion

Based on good financial performance, reasonable valuation & positive technical outlook, PWRoot could be a good stock for medium-term investment.

2 comments:

Political Crow's Nest said...

PWRoot QE 31/5/12 PBT and after tax seems to be opposite. Is that correct?

Alex Lu said...

Hi Political Crow's Nest

The quantum is correctly stated. Go to the link below.

http://www.bursamalaysia.com/market/listed-companies/company-announcements/1018861