NCB: Still Waters Runs Deep

Background

NCB has declined since it broke its uptrend line in July 2013. A retracement of nearly 100% of its gain from 2009 to 2013 means that this stock will a long time to recover. One can only hope that a bottoming phrase will kick in soon at RM2.80-3.00. Check out my last post (here).

 
 Chart 1: NCB's weekly chart as at July 9, 2014 (Source: Tradesignum)

Result Update

From Table 1, we can see that pre-tax profit improved q-o-q by RM6.5 million despite a drop in revenue of RM19.8 million. The improvement was due to lower losses in the Logistics operation of RM12.6 million which more than offset a decline of RM5.5 million in Port operation. Compared to previous year, pre-tax profit dropped by RM37.8 million while revenue dropped by RM25.3 million. The drop in profit was contributed by drop in pre-tax profit by both Port operation (of RM30.8 million) & Logistics operation (of RM7.4 million).


Table 1: NCB's segmental results


Table 2: NCB's last 8 quarterly results


Chart 1: NCBs last 27 quarterly results


Chart 2: NCBs last10 yearly results

Outlook

In addition to the losses in the Logistics operation, NCB faces challenges from WPRTS, such as the depth of its berths (generally shallower than WPRTS) and productivity of its berths & cranes (lower than WPRTS). The commencement of its new berth, CT4 in December 2013 could address the issue of maximum draft as CT4, which has a depth of 17m, can cater to ultra large vessels. CT4 has ready demand from existing customers, particularly Wan Hai (as per a report from Maybank IB Research). 


Table 3: NCB & WPRTS's Infrastructures compared (Source: Kenanga Research)


Chart 3: NCB & WPRTS's Terminal Utilization (Source: Kenanga Research)


Chart 3: NCB & WPRTS's Crane & Berth Productivity (Source: Kenanga Research)

Valuation

NCB (at RM2.95 yesterday) is now trading at a PB of 1 time and trailing PE of 59 times (based on last 4 quarters' EPS of 5 sen). On the other hand, the second port owner & operator in Port Klang, WPRTS (closed at RM2.74 yesterday) has a much higher PB of 6.1 times (based on NTA of RM0.45/share as at 31/3/2014) but a lower PE of 20 times (based on annualized EPS of RM0.139).

Conclusion

Despite the poor financial performance and bearish technical outlook, NCB may be worth considering for a long-term investment due to its substantial decline. The drop has brought out value in the stock as it trades at 1x its NTA per share.

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, NCB.

Insas: Uptrend to continue?

Insas has just broken above its intermediate downtrend line, RR at RM1.25-1.27. With this upside breakout, the stock could continue with its prior uptrend.


Chart: Insas's daily chart as at July 9, 2014 (Source: Tradesignum) 

Based on technical breakout, Insas could be a good trading BUY.

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, Insas.

Parkson: A stock for the contrarian

Background

Over the past 2 years, Parkson's share price has been declining (see Chart 1). It is now revisiting the 2009 low of RM2.30-2.50 (go here).


Chart 1: Parkson's weekly chart as at July 9, 2014 (Source: Tradesignum)

If you look at the last 8 quarterly results (in the table below) and the 29 quarterly results (in Chart 2), you will see that Parkson had a bad year in 2013. It bit the bullet in the end of CY2013 by terminating lease contracts of stores with potential closure which resulted in provision for penalty of RM46 million in QE31/12/2013. This has dragged down its earning for that quarter and hopefully will help in driving up its earnings in subsequent quarterly.


Table: Parkson's last 8 quarterly results


Chart 2: Parkson's last 29 quarterly results 


Chart 3: Parkson's last 10 years' results  (Source: Equities Tracker)


Valuation

Parkson (closed at RM2.50 yesterday) is now trading at a trailing PE of 19 times (based on last 4 quarters' EPS of 13.3 sen). If you expect Parkson's results to improve going forward, then the trailing PE is not very meaningful. It maybe more helpful to look at PB ratio and that ratio stood at an attractive 0.9 time.

Conclusion

Despite the poor financial performance for the past 2-3 years & bearish technical outlook, Parkson is a stock worth watching because it has dropped so much. I believe that the RM2.50 level could be a strong support and the base for a bottoming phrase for this stock. If you are a contrarian, you might start to slowly accumulate this stock.

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, Parkson.

Market Outlook: Who is calling the shots?

Over the past 1 year, the market action was not centered on the blue chip stocks nor the near blue chip stocks. This is clearly shown by the sideways movement in FBMKLCI (representing the Top 30 stocks) and the FBMMID70 (representing the next tier).


Chart 1: FBMKLCI's weekly chart as at July 9, 2014 (Source: Kentrade)


Chart 2: FBMMID70's weekly chart as at July 9, 2014 (Source: Kentrade)

The play was all in the 2nd & 3rd liners (represented by FBMSCAP); the fledgling stocks (FBMFLG) and the ACE Market stocks (FBMACE).

Of these 3 indices, the weakest group of stocks appears to be the stocks from the ACE Market. FBMACE was in a sideways movement for 4 years up to July 2013, when it finally broke above the horizontal line at 4800. Thereafter, FBMACE has been rising in an uptrend line, with support at 6500-6600. It is testing that support now.

We can see that there is a bearish divergence between FBMACE index and its RSI indicator. In addition, the Williams %R has broken below its uptrend line. Will FBMACE be the canary in the coal mine? Let's watch closely the ongoing test of the uptrend line support by FBMACE. If it breaks below 6500-6600, it could lead to further & sharper correction in the 2nd & 3rd liners across the whole market.  


Chart 3: FBMACE's weekly chart as at July 9, 2014 (Source: Kentrade)


Chart 4: FBMFLG's weekly chart as at July 9, 2014 (Source: Kentrade)


Chart 5: FBMSCAP's weekly chart as at July 9, 2014 (Source: Kentrade)

Airport: Uptrend continuation beckons!

Airport, which broke above its intermediate downtrend line at RM7.80-7.85 in mid-June. Since then, it has been drifting higher on thin volume, Today, it is testing its strong horizontal resistance at RM8.20. Indicators are supportive of a potential upleg for the stock.

If Airport can break above the RM8.20 mark, the stock could be a good trading BUY. It may also be a good medium-term investment as it may revisit the December 2013 high of RM9.75.


Chart 1: Airports daily chart as at July 4 2014 (Source: Tradesignum) 


Chart 2: Airports weekly chart as at July 4 2014 (Source: Tradesignum) 

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, Airport.

Presbhd: Uptrend to Continue!

Presbhd tested the horizontal line at RM2.06 yesterday Today, it surpassed this resistance as well as climbing back on top of its uptrend line. This is a clear sign that the stock has regained the upward momentum.


Chart 1: Presbhd's daily cahrt as at July 3, 2014 (Source: Chartnexus)

The last time, Presbhd surpassed a strong horizontal resistance was in October 2013. Then it cleared the horizontal line at RM1.12 & rose to a high of RM2.06. If it can travel the same distance again, we can expect Presbhd to test the RM3.00 mark. 


Chart 2: Presbhd's weekly cahrt as at July 3, 2014 (Source: Chartnexus) 

Based on technical breakout, Presbhd could be a good trading BUY>

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, Presbhd.

Tenaga: Waiting for Bullish Breakout!

Tenaga has been in the news lately on possible approval to get a tariff hike. In fact, Tenaga is overdue for a tariff adjustment according to the Incentive-Based Regulation (IBR) which started on 1 January. This regulation provides for a Fuel Cost Pass-Through (FCPT) to be implemented by way of a 6-monthly Fuel Component Cost review.

The Fuel Components are Domestic gas (subsidized input from Petronas at a rising scale), LNG gas (at market price) and Coal (at market price). From the charts below, we can see that the price of Natural Gas & Thermal Coal has risen in the past 6 months. As such, we can expect a tariff increase for Tenaga to compensate it for the increased fuel cost.


Chart 1: Thermal Coal price chart (Source: infomine.com)


Chart 2: Natural Gas price chart (Source: nasdaq.com)

The share price of Tenaga has been moving sideways because the market is nervously awaiting the first test of whether the Government will stick to the IBR by implementing the FCPT. 3 days into the month of July, we have yet to receive any news of a revision in Tenaga tariff rate. If the announcement is made now, one big uncertainty - which  has been a drag on the share price for Tenaga - will be removed.

From the chart below, we can see that Tenaga is pressing against its horizontal line at RM12.40. A convincingly upside breakout of the horizontal line (as well as the psychological RM12.50 mark) would signal the continuation of the uptrend for the stock.


Chart 3: Tenaga's weekly chart as at July 2, 2014 (Source: Tradesignum)

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, Tenaga.

Sign: Poised to take off!

Sign may have broken to the upside of its symmetrical triangle at RM1.50. If it can surpass the recent high of RM1.59 recorded in October 2013, the stock could take off. Even if it failed to clear the RM1.59 resistance, the stock has clearly shown its intention of going higher. (as at 12.25pm, Sign was trading at RM1.60).

Based on bullish technical breakout, Sign could be a good trading BUY.


Chart: Sign's weekly chart as at Jun 30, 2014 (Source: Tradesignum)
 
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, Sign.

TAGB: Bottom-line jumped!

Results Update

For QE30/4/2014, TAGB's net profit rose 34% q-o-q or 72% y-o-y to RM81.5 million while revenue was mixed- down 32% q-o-q & unchanged y-o-y at RM158 million. Bottom-line improved y-o-y due to sharp rise in pre-tax profit in two divisions:

• Investment holding division, which reported profit before tax of RM22.2 million in the current first quarter as compared to profit before tax of RM6.6 million previously, and 
• Finance & related services division, which reported profit before tax of RM35.4 million as compared to profit before tax of RM10.4 million in QE30/4/2013. 
  

Table: TAGB's last 8 quarterly results

Bottom-line soared as profit margin crossed the 40% mark!


Chart 1: TAGB's last 27 quarterly results

Valuation

TAGB (trading at RM0.355 yesterday) has a trailing PE of 12 times (based on last 4 quarters' EPS of 2.97 sen). At this PE, TAGB's valuation is deemed fairly valued.

Technical Outlook

TAGB broke above its long-term downtrend line, RR at RM0.30 in April. Only in early part of June did TAGB pulled away from the sticky downtrend line and tested its strong horizontal line at RM0.35. A convincing upside breakout of this horizontal resistance may send the stock to the next resistance at RM0.40 and beyond that to RM0.48.


Chart 2: TAGB's weekly chart as at Jun 30, 2014 (Source: Tradesignum)

Conclusion

Despite the improved financial performance & mildly bullish technical outlook, TAGB is a stock good for medium-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, TAGB.

Magni: Bottom-line dropped q-o-q due to lower sales!

Results Update

For QE30/4/2014, Magni's net profit dropped 43% q-o-q but rose 17% y-o-y to RM8.5 million while revenue dropped 13% q-o-q but rose 19% y-o-y to RM162 million. The q-o-q decline in revenue was attributable to lower sales orders received from garment business. This has caused a drop in the bottom-line for the company.

Table: Magni's last 8 quarterly results


Chart 1: Magni's last 21 quarterly results

Valuation

Magni (trading at RM3.16 as at 3.45pm) has a trailing PE of 8.2 times (based on last 4 quarters' EPS of 38.7 sen). At this PE, Magni's valuation is still undemanding. It may command a PE of 9-10 times.

Technical Outlook

Magni is in a gradual uptrend line. Its immediate support is at the 40-week EMA line at RM2.50. That would be a good entry level for the stock.


Chart 2: Magni's weekly chart as at Jun 27, 2014 (Source: Tradesignum)

Conclusion

Despite the weaker financial performance, Magni is still a good stock for long-term investment in view of its attractive valuation & good technical outlook.

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, Magni.

Multico: Broke its long-term uptrend line.

Background

Multi-Code Electronics Industries (M) Bhd ['Multico'] is involved in the manufacturing of electronics parts and accessories for the automotive industries. From the chart below, we can see that it is a medium size company with annual net profit of about RM10 million.


Chart 1: Multico's 17 yearly results

Other Information

In QE31/7/2007, it incurred a huge loss of RM33 million due to provision for doubtful debts. In 2010, 2 former directors of Multico were found guilty of defrauding the company of RM18 million. For more, go here.

Valuation

Multico (closed at RM1.53 last Friday) is now trading at a PE of 7 times (based on annualized EPS of 22 sen). At this PE, Multico- a smallcap stock- is deemed fairly valued.

Technical Outlook

Multico is in a long-term uptrend line until March this year. Then the stock broke its uptrend line at RM1.60 and slid to a low of RM1.45 before rebounding. However Multico failed to climb back above the uptrend line. It is likely to trade sideways in the near term.


Chart 2: Multico's weekly chart as at Jun 27, 2014 (Source: Tradesignum)

Conclusion

Based on mildly bearish technical outlook & fair valuation, Multico is rated a REDUCE.

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, Multico.

ULICorp: A bullish breakout!

ULICorp may have broken out of a Cu-with-handle yesterday. Its first target is RM1.40 & next one is RM1.70. It is trading at RM1.20 as at the time of writing (10.40am).


 Chart 1: Ulicorp's weekly chart as at June 26, 2014 (Source: Tradesignum)

ULICorp is involved in the manufacturing and trading of cable support systems, cable management systems, integrated ceiling systems, building materials and light fittings. It was successfully listed on the Second Board of Kuala Lumpur Stock Exchange on 23 April 2002.

ULICorp is a company with very healthy financial position. As at 31/3/2014, it has a current ratio & gearing ratio of 5.1 times & 0.2 time respectively. Its net cash stood at RM36.3 million or 28 sen per share.

Its financial performance is very steady, albeit minimal growth in top-line and bottom-line.


Chart 2: ULICorp's last 10 years' result  (Source: Equities Tracker)
 
Based on technical breakout, ULICorp could be a trading BUY.

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, ULICorp.

PWRoot: Breaking Out?

PWRoot is breaking to the upside of an ascending triangle at RM2.22 (see Chart 1). More importantly, it is on the verge of breaking above a much larger pennant (see Chart 2). As at 3.45pm, it is trading at RM2.25 on a relatively thin volume of 255000 units. For more on PWRoot, go here.


Chart 1: PWRoot's daily chart as at Jun 25, 2014 (Source: Tradesignum)


Chart 2: PWRoot's weekly chart as at Jun 25, 2014 (Source: Tradesignum)

Based on  mildly bullish technical outlook, PWRoot could be a trading BUY.

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, PWRoot.

Greenyb: Bullish breakout!

Greenyield Bhd ('Greenyb') may have broken to the upside its 3.5-year trading range of RM0.18-0.28. It closed at RM0.30 yesterday. If this breakout can sustain - and this is a big IF- then the stock's upleg may begin. First target will be RM0.38-0.40.


Chart 1: Greenyb's weekly chart as at June 23, 2014 (Source: Tradesignum)

Greenyb is a profitable company. It develops, manufactures and markets agricultural systems, products and services based on agro-technology. It has a strong balance sheet. As at 31/1/2014, its current ratio at 4 times while it has negligible borrowing of RM382k  as compared to Shareholders' Fund of RM54 million. At the same time, it has net cash in hand of RM14.1 million (or, 4.2 sen per share).

At RM0.30, Greenyb is trading at a PE of 18 times (based on annualized earning of 1.7 sen for FY14). At this multiple, Greenyb is deemed overvalued.
 

Chart 2: Greenyb's last 8 years' result (plus estimate for FY14) (Source: Equities Tracker & Nexttrade)

Based on technical breakout, Greenyb could be a trading BUY.

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, Greenyb.

Prlexus: Time to take profit!

Results Update

For QE30/4/2014, Prlexus's net profit dropped 67% q-o-q by 17% y-o-y to RM2.2 million while revenue was mixed- dropped 37% q-o-q but rose 14% y-o-y to RM53 million. Revenue dropped q-o-q from RM84.4 million to RM53.3 million due to lower revenue from the garment division. Net profit dropped q-o-q due to lower revenue and unrealised forex loss of RM1.7 million as compared to a unrealised forex gain of RM2.2 million in QE31/1/2014.

 
Table 1: Prlexus's last 8 quarterly results


Chart 1: Prlexus's last 23 quarterly results

Valuation

Prlexus (closed at RM1.81 yesterday) is now trading at a PE of 8.6 times (based on last 4 quarters' EPS of 21 sen). At this PE, Prlexus is deemed fully valued.

Technical Outlook

Prlexus is in a long-term uptrend. The stock should have good support at the 10-week SMA line and 20-week EMA line at RM1.62 & RM1.50 respectively.


Chart 2: Prlexus's weekly chart as at Jun 23, 2014 (Source: Tradesignum)

 Conclusion

Based on weaker financial performance & full valuation, it may be time to take profit on Prlexus. However, there is no need to rush to sell as the technical outlook for Prlexus is still positive. 

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, Prlexus.

MRCB: Time to go!

MRCB broke above its downtrend line at RM1.55 in February. After the breakout, the stock moved sideways between RM1.52 & RM1.68. Today, MRCB went above the RM1.68 level to touch an intra-day high of RM1.72.

If MRCB can stay above the RM1.68 level, the stock is poised to start its next upleg. Based on this, MRCB could be a trading BUY or a medium-term investment.


Chart: MRCBs weekly chart as at June 19, 2014 (Source: Tradesignum)

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, MRCB.

SKPetro: A New Chapter for SKPetro!

Result Update

For QE30/4/2014, SKPetro's net profit increased by 51% q-o-q or 444% y-o-y to RM509 million while revenue increased by 30% q-o-q or 51% y-o-y to RM2.44 billion.

Revenue & PBT jumped due to the inclusion of SapuraKencan Energy Inc. Group ('SKEI') business' financial results subsequent to the completion of its acquisition on Feb 11, 2014. SKEI (formerly known as Newfield Malaysia Holding Inc.) was acquired by SKPetro for USD896 million (or RM3.0 billion). The acquisition was completed in February 2014. 

The group also recognized RM177.8 million gain on acquisition of SKEI business during the quarter. If this one-off gain is adjusted, SKPetro's net profit would actually drop 2% q-o-q or rose 253% y-o-y to RM332 million (assuming the gain is not subject to tax).


Table: SKPetro's last 8 quarterly results


Chart 1: SKPetro's last 12 quarterly results

Valuation

SKPetro (closed at RM4.33 yesterday) is now trading at a trailing PE of 19.7 times (based on last 4 quarters' EPS of 22 sen). Most analysts are valued SKPetro at a forward PE of 24-25 times its 2015F earning. On that basis, SKPetro's fair value would be about RM5.00. (Note: TA valued SKPetro at RM5.98 while CIMB valued it at RM7.00.)

Technical Outlook

SKPetro is still in an uptrend line with support at RM4.00. Immediate resistance level is RM4.35 and then at RM4.75.


Chart 2: SKPetro's weekly chart as at June 19, 2014 (Source: Tradesignum)
 
Conclusion

Based on good financial performance, exciting prospects & positive technical outlook, SKPetro is still a 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, SKPetro.

AEONCR: Bottom-line jumped

Result Update

For QE20/5/2014, AEONCR's net profit increased by 18% q-o-q or 36% y-o-y to RM56 million while revenue increased by 7% q-o-q or 40% y-o-y to RM201 million.

Revenue increased 40% y-o-y due to increase in interest income, profit revenue & finance charges (from RM120.2 million to RM173.2 million) as well as increase in fee income (from RM23.7 million to RM27.7 million). Because of these, AEONCR was able to record a 35%-increase in pre-tax profit, notwithstanding marginally  higher funding cost, higher non-performing loans (NPL) ratio (of 2.18% as at May 2014 compared to 1.57% as at May 2013);  and higher ratio of total operating expenses against revenue (at 54.57% as compared to 54.01% previously).

How AEONCR achieved this improved results since its Total Assets only inched up by 6.3% from RM3.767 billion to RM4.005 billion? With narrower interest margin; higher operating expenses; and a smaller increase in Total Assets - the bulk of which consisted of Financing Receivables which rose 7.6% to RM3.84 billion from RM3.57 billion - how did they do it? Fee income alone does not explain it.


Table: Aeoncr's last 8 quarterly results


Chart 1: Aeoncr's last 28 quarterly results

Valuation

AEONCR (closed at RM14.92 yesterday) is now trading at a PE of 11.3 times (based on last 4 quarters' EPS of 132 sen). Based on past 2-year historical CAGR of 35%, AEONCR's PEG ratio is about 0.3 times. At this low PEG ratio, AEONCR looks like an attractive growth stock again!

Technical Outlook

After the 6-month correction in 2H13, AEONCR transitioned into sideways movement for the past 4-5 months. If it can break above RM15.40, it may continue with its prior uptrend.


Chart 2: Aeoncr's weekly chart as at June 19, 2014 (Source: Tradesignum)

 
Chart 3: Aeoncr's weekly chart as at June 19, 2014 (Source: Tradesignum)

Conclusion

Based on good financial performance & attractive valuation, AEONCR is still a good stock for long-term investment. If it can surpass the RM15.40 resistance, AEONCR may rise again.

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, AEONCR.

Astro: Better Results, Still Expensive

Results Update

For QE30/4/2014, Astro's net profit increased by 15.2% q-o-q or 12.4% y-o-y to RM128 million while revenue was mixed: down marginally by 0.5% q-o-q but up 11.4% y-o-y to RM1.254 billion.

The increased revenue y-o-y was attributed to higher subscription, advertising & licensing income and sales of decoders. Higher subscription was the results of higher ARPU (from RM94.20 last year to RM97.10) as well as increased subscribers (from 3.32 million to 3.47 million).

In addition to higher y-o-y revenue, Astro's bottom-line also benefited from lower marketing & market research costs, staff-related costs & lower tax bill.

Table: Astro's last 8 quarterly results


Chart 1: Astro's last 11 quarterly results

Valuation

Astro (closed at RM3.54 yesterday) is now trading at a trailing PE of 40 times (based on last 4 quarters' EPS of 8.9 sen). At this PE, Astro is over-valued.

Technical Outlook

Astro broke above its recent high of RM3.23 in early April (here). It rallied to a high of RM3.70 before correction set in. From the chart below, we can see that Astro share price has hit the line connecting its recent highs. If it pulled back to RM3.30-3.40 (between the 20-d SMA line and 50-d SMA line), the stock could be a good trading BUY.


Chart 2: Astro's daily chart as at Jun 18, 2014 (Source: Tradesignum)

Conclusion

Despite the improved financial performance, Astro is rated a SELL INTO STRENGTH at RM3.60-3.70 due to demanding valuation and mildly challenging technical set-up.

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, Astro.

BAT: What Are You Smoking?

BAT broke above its recent high of RM67-68 today. At the time of writing this post, it was trading at RM70.22. This bullish breakout (albeit on thin volume) signals the continuation of its prior uptrend.


Chart 1: BAt's weekly chart as at June 16, 2014 (Source: Tradesignum)

BAT's recent financial performance is shown in the table and chart below.


Table: BAT's last 8 quarter's result


Chart 2: BAT's last 29 quarter's result

BAT (at RM70.22 now) is trading at a trailing PE of 24 times. At this PE, its upside potential is limited.

Why is the share price rallying today? I believe it has to be something big, like a takeover or privatization exercise. We will have to wait & see.

Based on technical breakout, BAT could be a trading BUY.

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, BAT.