Friday, October 29, 2010

Dayang has a very bullish breakout


Dayang gained 20 sen to close at RM2.59 today.The sharp rally saw the stock breaking above its horizontal resistance at RM2.40 as well as the line connecting three prior peaks. See the daily & weekly chart below.


Chart 1: Dayang's daily chart as at Oct 29, 2010 (Source: Quickcharts)



Chart 2: Dayang's weekly chart as at Oct 29, 2010 (Source: Quickcharts)

Dayang is an oil & gas service provider. For 1H2010 ended 30/6/2010, Dayang recorded a net profit of RM27.4 million on a turnover of RM99.5 million (go here). Its EPS for that period was 7.79 sen- giving the company an annualized EPS of 15.58 sen. At RM2.59, Dayang is trading at a current PE of 16.6 times. At this multiple, Dayang is deemed overvalued. The market is obviously anticipating some very positive development for this stock in order to justify the current market price.

Dayang has a very healthy financial position. As at 30/6/2010, its current ratio was at 3.3 times while its borrowings to equity stood at 0.3 time only.

Based on bullish technical outlook, Dayang could be a trading BUY. However, Dayang has rallied quite substantially today & one may be better served by buying on a pullback.
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4 comments:

  1. kangmingwSunday, October 31, 2010 1:53:00 AM

    What do you think of MHB & mahsing?
    worth to buy now?

    ReplyDelete
  2. NightwatchmenSunday, October 31, 2010 5:05:00 PM

    Hi Alex

    what is the new tp for kfc and qsr?
    both look great Thanks

    ReplyDelete
  3. Alex LuTuesday, November 02, 2010 12:35:00 PM

    Hi Kenny,

    MHB had a great run due to strong buying by foreign funds. Nevertheless, I think that it is fully valued.

    Mahsing is currently trading at a PE of about 12.5 times. With more launches in the pipeline, Mahsing's PE looks undemanding. the stock is in an uptrend line, with uptrend support at RM1.60-1.65. However, its immediate support is at the horizontal line RM1.80 while its immediate resistance is at RM2.00.

    ReplyDelete
  4. Alex LuTuesday, November 02, 2010 1:57:00 PM

    Hi nightradersdk

    I won't estimate the target price for KFC & QSR. Chartwise, KFC & QSR could go as high as RM4 & RM7.00, respectively. These 'targets' are very rough guesstimates based on lines connecting the peaks on charts plotted on log scale. Since thse stocks have gone to new high, anything is possible.

    ReplyDelete