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Thursday, October 15, 2015

Topglov: Earnings jumped

Results Update

For QE31/8/2015, Topglov's net profit rose by 43% q-o-q or 123% y-o-y to RM103 million while revenue rose by 7% q-o-q or 23% y-o-y at RM709 million.  Profit Before Tax rose by 33.7% q-o-q to RM134.5 million due to higher sales volume, ongoing efficiency and quality enhancement initiatives, low raw material prices and a stronger US Dollar.

 
Table: Topglov's last 8 quarterly results


Chart 1: Topglov's last 37 quarterly results

Valuation

Topglov (traded at RM8.45 as at 3.30pm) is now trading at a PE of 18.8 times (based on last 4 quarters' EPS of 45 sen). At this PE multiple, Topglov is fairly valued.

Technical Outlook

From Chart 2 below, we can see that Topglov broke above its large pennant formation ('ABCD") at RM6.30. With this breakout, the share price is expected to continue its uptrend.
 

Chart 3: Topglov's monthly chart as at Oct 15, 2015_3.00pm (Source: ShareInvestor.com)

Conclusion

Based on better financial performance, fair valuation & positive technical outlook, Topglov is a good stock for long-term investment.

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, Topglov.

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