Java's net profit continue to rise

Java has recently announced its results for QE30/9/2006. Its net profit increased 28.6% q-o-q to RM17.0 mil despite a 22.3%-decline in turnover to RM80.7 mil. The improved net profit was attributable to the overall better timber prices. As result thereof, Java's EPS for QE30/9/2006 increased 12.3% to 10.3 sen when compared to the EPS for QE31/3/2006.

Based on the latest quarter's EPS of 10.3 sen, Java's annualized EPS is about 41.2 sen. As its hsare price closed at RM1.54 yesterday, Java is now trading at a PE of 3.7 times only.




Despite a very good set of results, Java's share price has dropped back a bit. From the chart below, you can see that the price has retraced below its 10-day SMA of RM1.55. I believe that Java is a good long-term investment based on its cheap valuation & the good price for timber logs. As such, you may use this period of price weakness to accumulate this stock.