Friday, July 05, 2013

TAS- poised for uptrend?


TAS has just broken above its strong horizontal resistance of RM0.53. Its next resistance levels will be RM0.60 & RM0.70. Based on technical consideration, TAS could be a good trading BUY.



Chart: TAS's weekly chart as at July 5, 2013_9.20pm (Source: Quickcharts)

For QE28/2/2013, it reported a net profit of RM6.1 million on a revenue of RM41 million (go here for more). Its annualized EPS would be about 7.8 sen. At the present price of RM0.54, the stock is trading at a PE of 7 times, which is relatively expensive for a small cap. Its Price to Book is about 0.65 time (based on NTA of RM0.83 as at 28/3/2013).

Note: 
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, TAS.

10 comments:

luminaire10 said...

Hi Alex,

Can you comment on YTLP price recently? Is this due to share buy back?

Between YTL and YTLP, which one is good for long term investment?

Thanks,

JY said...

Today's breakout can consider a cup in a handle pattern?

Alex Lu said...

Hi JY

Yes, TAS's breakout looks like a cup in a handle pattern. The trigger to buy is the break above RM0.48. Next resistance is the RM0.53 which it is testing/breaking now.

Alex Lu said...

Hi luminaire10

Yes, YTLPower may have broken above its long-term downtrend line. More importantly, it has also surpassed the strong horizontal resistance at RM1.60.

It may rest at RM1.60 for a while before commencing on its upleg. You may use any weakness or pullback to RM1.60 to slowly accumulate the stock.

PEGGY Method said...

Hi, you mentioned that PE ratio of 7 times is considered as "relatively expensive" for small cap, may I know roughly at what level the PE is not expensive and at what level is considered cheap. Just a rough figure will do.

Thanks.

Billy Teo said...

Hi Alex,

What's yr view on AZRB?

Thanks

Chun Mun said...

Hi Alex,
What is your opinion on picorp? Is it good buy now? Thank you very much.

Alex Lu said...

Hi PEGGY Method

Good to see your comment.

Determining the appropriate PE multiple to apply to a stock is tricky. Some writer would think smallcap stocks should command a PE of 5-8 times while bigcap stocks should command a PE of 12-15 times.

TAS is a smallcap (market cap of about RM100 mil) that is involved in a cyclical business (ship-building). With that, I feel that it is not cheap.

In the near future, the earning may increase and the prospective PE may be lower than the trailing PE. Since I did not look into its prospect, I can't comment on that.

Technical analysis seems to suggest the possibility of something exciting in the future and my post is based on that angle- notwithstanding my thought on the valuation.

Alex Lu said...

Hi Chun Mun

Picorp is still trying to break above its downtrend. At this moment, there is no tentative sign of its next price direction. Its recent low at 12 sen would be a good support.

Earning has rebounded due to higher profit contribution by the Laboratory testing segment while the Environmental Consultancy saw a dip in earning.

Alex Lu said...

HI Billy Teo

I am not familiar with AZRB. It seems to have a breakout above its long-term downtrend line at RM0.92. Its immediate resistance is at the psychological RM1.00 mark and then at RM1.10 & RM1.30.