Yesterday, Haio has announced its quarterly results for QE30/4/2007. Haio's net profit has jumped by 56.5% q-o-q or 239% y-o-y to RM7.8 mil, while its turnover has increased by 10.4% q-o-q or 65.4% y-o-y to RM56.7 mil. If we compared the results of the last 4 quarters with those of the preceding 4 quarters, we can see that its net profit has doubled from RM9.9 mil to RM21.2 mil while turnover has increased by 30% from 146 mil to RM189 mil. For these periods, the 4-quarter EPS has jumped from 16 sen to 32 sen. The company attributed its improved results to higher sales from its MLM & retails divisions.
Based on yesterday's closing price of RM2.85 & last 4-quarter EPS totaling 32 sen, Haio is now trading at a PE of 8.9 times. This is an undemanding PE multiple given its strong growth in both topline & bottomline.
From the chart below, we can see that the share price has risen quite substantially in the past 2 week from about RM2.25 to RM2.85 now. It is quite possible that some profit-taking may occur around the RM3.00 level. You may use any price weakness to gain entry into this stock.
Chart: Haio's daily chart as at June 15 (courtesy of Tradesignum.com)
This call is made without due consideration of the company's position.
4 comments:
Hi nexttrade,
i have been eyeing HAIO for sometime now, just that the price keeps going up, it is hard for me to enter. But i'm very glad that you did a page on it. Thank you very much!
Are you also eyeing Esthetics or QL resources?
I am familiar with these companies. Esthetics has a good earning track record; making 11.5 sen for FYE31/3/2007. This is comparable to its EPS for the 13-mth ended 31/3/2006. At Friday's closing of RM0.81, Esthethic is trading at PE of 7 times. Its Balance Sheet looks OK.
QL was a stock I have recommended to my clients in 2003 at about RM1.00. We have regrettably cashed out at RM2.00 and it is still going strong. Its latest results for FYE31/3/2007 shows a EPS of 28.4 sen, which improved from 23.9 sen in FYE31/3/2006. At Friday's close of RM3.40, QL is trading at a PE of 12 times. Its Balance Sheet is also quite healthy.
how do u find NATBIO?
I find the rapid rise of Natbio, a home-grown company selling beverage drinks (enhanced with Tongkat Ali) a bit incredulous. While my knowledge of this sector is limited to that's of a layman, my investment instinct tell me to tread carefully with this stock. Its track record is too short. What if its Tongkat Ali drinks were just passing fads? Can Natbio sustain its topline & bottomline?
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