Wednesday, February 09, 2011

Maxis has a bullish breakout

Maxis broke above its horizontal resistance at RM5.40 this morning. Since its listing in November 2009, Maxis seems to be rising in a step-ladder fashion, with each breakout leading to a small gain of RM0.20. If that pattern persists for the present breakout, then there is little to gain for getting into the stock. However, one can never know how a stock will perform after a breakout. For those who have been egging to getting into Maxis, this could be the green light that you have been waiting for. See the chart below.


Chart: Maxis's daily chart as at Feb 9, 2011_3.30pm (Source: Quickcharts)

For those with a more aggressive appetite, you may try Maxis-CD or CE or better still Maxis-JA. However, the tenor for Maxis-CD is rather short as it's due to expire in March. The better instrument for an aggressive play onMaxis's bullish breakout would be Maxis-JA, which is a Callable Bull Certificate (or 'CBLC'). As mentined previously, CBLC is very similar to a Call Warrant (or 'CW') except it has the added feature of having a Mandatory Call Event ('MCE') which automatically forces the issuer to recall the CBLC when it hit a Minimum Trading Price ('MTP') (for more, go here). At a premium of 1.2%, Maxis-JA is deemed fairly attractive.


Table: Maxis's CWs & CBLC valuation & terms
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4 comments:

  1. keane hongWednesday, February 09, 2011 5:23:00 PM

    how abt your view of Naim, seem brake up a new price of 52 weeks ~ high low graph. Is it starting bullish up ??

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  2. Alex LuFriday, February 11, 2011 8:39:00 AM

    Hi keane hong

    I am not familiar with Naim. Chartwise, it is trading very near the line connecting its previous highs recorded in Jan, Mar & Nov 2010. That line is not a horizontal line but a rising line, with resistance at RM3.95-4.00. If it can surpass this level, it may go higher. If not, it may pullback to RM3.20-3.30 level.

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  3. leslieroycarterFriday, February 11, 2011 2:32:00 PM

    Hi Alex:
    May u comment on CCB which is consolidating from the height of RM 8.00 ? Looking on its dividend trend , this share has been constantly paid out sp dividend at a tune of RM1 to RM2 within a period of 1-2 yrs. Last yr , it failed by paying out sp dividend though the co is making handsome profit . Could it meant that the co is changing direction of paying sp dividend? Do comment chartwise n fundamentally. Thanks

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  4. Alex LuWednesday, February 16, 2011 3:32:00 PM

    Hi leslieroycarter

    CCB may have broken above its recent downtrend line at RM4.40 on Jan 3. Since that breakout, the stock has been consolidating in a flag formation. It may have broken above the flag formation at RM4.60 on February 14 (this Monday). However, it must be noted that the breakout is on thin volume and as such it is not very convincing.

    CCB is now trading at a PE of about 17 times (based on full year EPS of 28 sen). At that multiple, CCB is deemed fully valued.

    Regarding its tendency for huge dividend payout: CCB is more likely to be in the same boat as BJToto instead of Digi.com. I think this payout has substantially reduced its cash position and future cash inflow would not be sufficient for annual big payout. From FY2003 until today, CCB had 4 years of exceptional dividend payout- RM4.42 in FY2003, RM2.13 in FY2006, RM1.45 in FY2008 & RM1.30 in FY2009. Its NTA per share dropped from a high of RM6.77 as at 1/1//2003 to RM1.80 as at 30/9/2010.

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