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Wednesday, February 03, 2016

PBBank: Earning soared

Result Update

For QE31/12/2015, PBBank's net profit rose 24% q-o-q or 19% y-o-y to RM1.49 billion while revenue increased by less than 1% q-o-q or 9% y-o-y to RM4.93 billion. Profits rose mainly due to the net writeback of loan impairment allowances during the current period and higher net interest income.


Table: PBBank's last 8 quarterly results

From the chart below, we can see that PBBank's profits & profit margins rose while revenue hardly inched up.


Chart 1: PBBank's last 40 quarterly results

Valuation

PBBank (closed at RM18.38 today) is now trading at a PE of 14.0 times (based on last 4 quarters' EPS of 131 sen). At this PE multiple, PBBank is deemed reasonably priced. It pays a dividend yield of 3%.

Technical Outlook

PBBank is still in a long-term uptrend line, with support at RM18.00.


Chart 2: PBBank's monthly chart as at Feb 3, 2016 (Source: ShareInvestor.com)

PBBank seems to be trapped in a descending triangle for the past 2 years. The support is at RM17.40-17.50. An upside breakout of the downtrend line, RR (or the upper line of the triangle) at RM19.00 could signal the continuation of the long-term uptrend line.


Chart 2: PBBank's weekly chart as at Feb 3, 2016 (Source: ShareInvestor.com)

Conclusion

Based on good financial performance, reasonable valuation & neutral technical outlook, PBBank 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, PBBank

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