Table: Karex' last 8 quarters' P&L
Graph: Karex' last 28 quarters' P&L
Karex's financial position as at 30/9/2020 is deemed very healthy. Its current ratio stood at 2.3 X while total liabilities to equity stood at only 0.3 X.
Karex (closed at RM0.845 yesterday) is now trading at a PER of 176x (based on last 4 quarters' EPS of 0.48 sen). Based on the high PER, Karex is deemed unattractive. However, if the earnings recovery continues, the valuation will be less demanding in the future.
Karex appears to have broken above the 2-year base of RM0.30-0.60.
Chart: Karex's weekly chart as at November 24, 2020 (Source: Malaysiastock.biz)
Based on improved financial performance, healthy financial position, and mildly positive technical outlook, Karex may be a good stock for a recovery play. However, the valuation is very demanding and a big rally will only spring up if earnings improved substantially.
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