Alam Maritime Resources Bhd ('Alam') is an Oil & Gas services company, involved mainly in the provision of offshore support vessels & underwater services.
Recent Financial results
Alam has just announced its results for 3Q2009 ended 30/9/2009. Its net profit increased marginally q-o-q but by 11% y-o-y to RM25.7 million. Its turnover increased by 28% q-o-q from RM80.7 million to RM103.2 million but declined by 4.2% y-o-y.
Table 1: Alam's 8 quarterly results
Chart 1: Alam's 11 quarterly results
Future Prospect
Alam expects its results to benefit from continued exploration & production programs by oil majors and new vessels being delivered in 2009 & 2010.
Valuation
Alam (closed at RM1.85 at end of the day) has a PE of 9.2 times (based on last 4 quarters' EPS of 20 sen). This compared favorably to Sapcres & Kencana which are both trading at PE of about 18 times. Sapcres (closed at RM2.24 today) reported EPS of 6.2 sen for its 1H2010 ended 31/7/2009 while Kencana (closed at RM2.37 today) recorded EPS of 13.1 sen for its FYE 31/7/2009.
Technical Outlook
Alam has unfortunately broken below its uptrend line at RM1.90-95 in early November. With this breakdown, the share may drift lower & test its horizontal support at RM1.70 & RM1.50.
Chart 2: Alam's weekly chart as at Nov 18, 2009_3.30pm (Source: Quickcharts)
Conclusion
Alam is an attractive O&G counter for long-term investing. Its negative technical outlook could mean that this stock may need to consolidate its recent price gain before starting on its next upleg.
Hi Alex,
ReplyDeleteI go in LCL with higher price compared to current price. HAi..i just wonder why the Shareholder Dato' Low Chin Meng keep selling its share even in 0.457sen. is that possible LCL kena blacklist or loss a lot in this quarter.. should i hold the LCL.. Your comment is valuable.
One of the influential brokers issues a trading buy on LCL last couple of months. Quite a lot of people kena. Do consider "Warrior cut arm"
ReplyDeleteAlam might be a safer keep with its track records. Still, I believe Uncle Quek will make a splashing wave soon. Do watch his stocks.
Hi Teh,
ReplyDeleteSorry to hear about this unfortunate trade. We may never know why the main shareholders sold off his shares or when would the selling cease. On the way down, LCL broke through the horizontal support of RM0.60 & RM0.50. On Nov 17, it tested the RM0.40 support & rebounded. Will the RM0.40 support hold on the next test? For your information, the previous low was at RM0.325.
If you are about to make your entry into this stock (present quote: 0.405/0.410), then you are betting that it may rebound at the RM0.40 horizontal support. Set your profit-taking target & protective stop, now (say, at RM0.45 & RM0.38, respectively). If the trade were to go against you and hit RM0.38, you have no choice but to cut loss & move on.
In your case, you have gained entry at higher price. The above steps may still apply. The RM0.40 level is the line drawn in the sand. Use that to protect your capital or as the staging ground for a rebound.
I hope this will be useful to you.