For QE30/6/2018, Frontkn's net profit rose 92% q-o-q or 107% y-o-y to RM12 million while revenue rose 15% q-o-q or 16% y-o-y to RM82 million. Revenue rose q-o-q due to improved business performance for the Group’s subsidiary in Taiwan, Malaysia, Singapore and the Philippines. PBT soared mainly due to higher revenue and foreign exchange gain as compared to foreign exchange loss in the immediate preceding quarter.
Table: Frontkn's last 8 quarterly results
Graph 2: Frontkn's last 25 quarterly results
As at 30/6/2018, Frontkn's financial positon is deemed healthy with current ratio at 2.6 times and gearing ratio at 0.34 times. It has net cash in hand totaling RM105 million (or, RM0.08 per share).
Frontkn (closed at RM0.64 yesterday) is trading at a trailing PER of 18 times (based on last 4 quarters' EPS of 3.55 sen). At this PER, Frontkn is deemed fully valued.
Frontkn broke above the high of RM0.52 recorded in January this year. It may potentially hit a high of RM0.67-0.70 based on 1-to-1 extension.
Chart 1: Frontkn's weekly chart as at Aug 7, 2018 (Source: Shareinvestor.com)
Frontkn's uptrend is very sharp, rising from RM0.13 in 2016 to the current price of RM0.64. All exponential rallies are beautiful events- until pullback set in. Then they would leave a bloody trail. Be careful.
Chart 2: Frontkn's monthly chart as at Aug 7, 2018 (Source: Shareinvestor.com)
Based on good financial performance & healthy financial position and positive technical outlook, Frontkn can be a good stock for long-term investment. As always, you should consider buying only when the price weakness.
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