For QE31/3/2015, DLady's net profit dropped by 50% q-o-q or 26% y-o-y to RM17 million while its revenue dropped by 25% q-o-q or 14% y-o-y to RM197 million. Revenue dropped q-o-q due to the phasing in of the relaunch of Dutch Lady Children Formula Milk. Additionally, in the immediate preceding quarter, higher sales of UHT was due to the seeding-in of the PureFarm range and strong sales of Dutch Lady Growing Up Milk to support “Mak Kata” promotion campaign. Profit before tax in Q1 2015 was lower compared to the preceding quarter due to the lower revenue
Table: DLady's last 8 quarterly results
Chart 1: DLady's last 28 quarterly results
Valuation
DLady (closed at RM46.80 yesterday) is now trading at a PE of 29 times (based on last 4 quarters' EPS of 162 sen). At this PE, DLady is deemed fully valued. Nevertheless, the DY of 4.7% will continue to be its strongest attraction.
Technical Outlook
Since October 2012, DLady has been moving sideways around RM46-48. Its indicators gave mixed reading, with monthly MACD hooked down & Slow Stochastic at the 50-mark. A breakout of the trading range of RM46-48 will point the way forward for the stock.
Chart 2: DLady's weekly chart as at May 26, 2015 (Source: Share Investor)
Conclusion
Based on poorer financial performance, demanding valuation & technical weakness, I would rate DLady as a REDUCE.
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, DLady.
2 comments:
Hi Alex,
From your point of view, is TAHPS Group Berhad(2305) a good stock to invest for long term period?
Its assets understated as it holds land bought at low price especially its Puchong vacant land. Why these assets have not been revalued?
At share price Rm6.80, is TAHPS deemed fully valued?
Please advice. Thanks in advance.
Lam.
Hi Lam,
I am not familiar with TAHPS. So my comment is based on a quick glance of the fundamental fact sheet & chart.
TAHPS's revenue of RM102m for FY31/3/2015 looks inadequate compared to its total asset of RM57m. However, its earning is quite respectable at RM44m.
At RM7.00, it is trading at PBR of 1.1X, PER of 12X and DY of 4.6%. These multiple and yield look fairly reasonable. The stock is in an uptrend with support at RM6.70-6.80.
It is probably an asset play, like SAB. With property market softening, the asset play theme has lost its momentum. When was the last time you heard Mahsing acquiring a new property? You have to sit on this stock for a while.
Post a Comment