For QE30/6/2016, WTHorse's net profit dropped 77% q-o-q or 75% y-o-y to RM4.0 million while revenue was up 9% q-o-q or 0.5% y-o-y to RM186 million. Profits dropped q-o-q mainly due to the higher production and operating costs coupled with the weakening of Ringgit Malaysia against the foreign currencies.
Table: WTHorse's last 8 quarterly results
Chart 1: WTHorse's last 44 quarterly results
WTHorse (closed at RM2.16 yesterday) is trading at a PE of 20 times (based on last 4 quarters' EPS of 11 sen). At this PER, WTHorse is deemed overvalued.
WTHorse broke below its long-term uptrend line at RM2.20. The share price is likely to move sideways or downwards with immediate support at RM2.00.
Chart 2: WTHorse's monthly chart as at Aug 16, 2016 (Source: ShareInvestor)
Based on poorer financial performance, demanding valuation and negative technical outlook, I would rate WTHorse as REDUCE or SELL.