APM announced a big dividend payout

Result Update

For QE30/6/2013, APM's net profit increased by 26% q-o-q or 20% y-o-y to RM36 million while revenue increased by 19% q-o-q or 22% y-o-y to RM388 million.  The improved financial performance was due to higher sales volume, which is attributable to the "weakening of Japanese Yen against Ringgit at end of 2012 resulted to devaluation of Japanese Yen denominated inventory in 4Q12".

APM announced an interim dividend of 10 sen less tax plus a special dividend of 30 sen in the latest quarter. This is a continuation of a trend of increasing dividend payout. See Chart 1 below.


Table: APM's last 8 quarterly results


Chart 1: APM's last 21 quarterly results

Valuation

APM (closed at RM5.40 yesterday) is now trading at a PE of 9.3 times (based on last 4 quarters' EPS of 58 sen). In term of PE multiple, APM is deemed almost fully valued.

Inclusive of the special dividend of 30 sen, APM's total dividend for the past 1 year is 62 sen. This gives a dividend yield of 11.5% (or, 5.9% excluding the special dividend). With its sttractive dividend yield, APM can be considered an income stock.

Technical Outlook

APM broke below the horizontal line at RM5.50. Its next support is at the horizontal line RM5.00 and thereafter the long-term uptrend line at RM4.90-4.95.


Chart 2: APM's weekly chart as at Aug 28, 2013 (Source: quickcharts)

Conclusion

Based on good financial performance, reasonably attractive valuation & positive technical outlook, APM is deemed a good stock for long-term investment. In the present poor sentiment, APM may pullback to RM5.00, which would be ab attractive entry to the stock.

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, APM.