For QE31/12/2017, Gtronic's net profit rose 74% q-o-q or 293% y-o-y to RM25 million while revenue rose 20% q-o-q or 124% y-o-y to RM105 million. Revenue rose q-o-q due to the higher volume loadings and mass production of new products from certain customers in the Group. This led to a huge jump in net profit profit to RM25.0 million from RM14.4 million in QE30/9/2017.
(Note: Gtronic's latest result for QE31/12/2017 was released on February 27.)
Table: Gtronic's last 8 quarterly results
Chart: Gtronic's last 48 quarterly results
Gtroni's financial position is healthy with current ratio at 2.5 times and gearing ratio at 0.4 time.
Gtronic (closed at RM4.52 yesterday) is now trading at a PE of 25 times (based on last 4 quarters' EPS of 18.04 sen). At this elevated PER, Gtronic is deemed fully valued.
Gtronic broke the strong horizontal support of RM5.80 on March 1. Then it broke below the intermediate uptrend line, SS at RM5.30 on March 21. Thereafter it quickly broke the next 2 horizontal lines at RM5.15 & RM4.80. It is now resting at the horizontal line of RM4.30. The selldown is likely due to overall poor market sentiment which has dragged down many stocks, including 2 other semiconductor stocks- MPI & Unisem. Life is full of surprises; just when Gtronic starts to deliver the goods, the share price took a plunge!!
Chart 1: Gtronic's weekly chart as at March 26, 2018 (Source: Malaysiastock.biz)
My technical studies below shows the stock has a tendency to go one-up before topping off. Despite the sharp drop, the stock is still trading above its long-term uptrend line with support at RM4.00.
Chart 2: Gtronic's weekly chart as at March 26, 2018 (Source: Malaysiastock.biz)
Based on satisfactory financial performance & position, Gtronic can be a good stock for long-term investment. Since the stock is still trading above its long-term uptrend line, I think it is fairly attractive after the recent selldown.
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