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Monday, November 30, 2015

Panamy: Earnings soared

Results Update

For QE30/9/2015, Panamy's net profit increased by 27% q-o-q or 54% y-o-y to RM40 million while revenue increased by 5% q-o-q or 13% y-o-y to RM281 million. Revenue increased q-o-q mainly due to export market for Home Shower products have increased as compared to the preceding quarter as these products are seasonally higher in the current quarter. Profits increased q-o-q mainly attributed by higher share  of  profits  from  associated  company  amounting  to  RM6.2 million  in  this  quarter  as compared to RM2.6 million registered in the preceding quarter.


Table: Panamy's last 8 quarterly results


Chart 1: Panamy's last 35 quarterly results

Valuation

Panamy (at RM22.56 last Friday) is trading at a PE of 11 times (based on last 4 quarters' EPS of 202 sen). At this PER, Panamy is deemed attractively valued. In addition, Pananmy has announced dividend totaling 142 sen, which translates to an attractive DY of 6.3%.

Technical Outlook

Panamy is a long-term upward channel, with support at RM20.00. If Panamy can surpass its 2013 high of RM23.50, it may continue with its uptrend.


Chart 2: Panamy's monthly chart as at Nov 27, 2015 (Source: ShareInvestor)

Conclusion

Based on good financial performance, attractive valuation and positive technical outlook, Panamy is still 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, Panamy.

2 comments:

steve said...

I am still wondering how can panamy traded at such low valuation for so many years. Is there any big risk that I couldn't see? It has very strong cash flow and 1/3 of market cap's cash pile. Excellent management and solid back bone parent company. The retail is focus on mid-end products which is the most conservative. Not to mention the company's consistent dividend payout to shareholders.

Also, I am interested to know your opinion on the fundamental area of Bonia.

Thank you and appreciate your kind sharing as always. Bravo!

Alex Lu said...

Hi steve,

I agree with you on Panamy. It reminds me of Aji(nomoto). Cheap & good!

As for Bonia, it is resting at its long-term uptrend line at RM0.70. Its rolling 4-Q revenue rose 4% to RM689 million while net profit declined by 5% to RM49 million, leading to a decline in EPS from 6.4 to 6.1 sen.

At RM0.72, it is trading at PER of 12x or Price to Book of 1.6x. This makes Bonia a more attractive stock than Padini which has a PER of 13.2x & a PB of 2.9x.

I rate Bonia a good BUY for long -term.