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Thursday, February 04, 2016

RCECap: Recovery continued

Result Update

For QE31/12/2015, RCECap's bottom-line continued to improve. Its net profit rose 27% q-o-q or 315% y-o-y to RM13.0 million on the back of higher revenue (up 6.4% q-o-q or 23.9% y-o-y to RM42 million). Net profit increased q-o-q mainly due to higher interest income by RM2.5 million


Table: RCECap's last 8 quarterly results

Looking at the Chart 1, we can see that RCECap's financial performance continued to crawl up after bottoming in last 2013.


Chart 1: RCECap's last 35 quarterly results

Valuation
RCECap (closed at RM0.255 yesterday) is now trading at a PE of 7.5 times (based on last 4 quarters' EPS of 3.42 sen). Price to book ratio stood at 0.7 time (based on NTA of RM0.35 per share).

Technical Outlook

RCECap is now rising in an upward channel with support at the lower line at RM0.25 and resistance at the upper line at RM0.35.


Chart 2: RCECap's monthly chart as at Feb 3, 2016 (Powered by ShareInvestor.com)

Conclusion

Based on improved financial performance, fair valuation & positive technical outlook, RCECap is 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, RCECap.

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