Recently, I have posted on DXN's technical breakout & the test of its recent high (here). We do not know the true reason why a stock put in a breakout. Since the breakout happened prior to the results, we should study it and determine whether the results announcement triggered the breakout.
Results Update
DXN announced its results for QE31/5/2011 at the close of business on July 25. Its net profit increased by 34% q-o-q but declined by 10% y-o-y to RM9 million while its turnover was hardly changed at RM68 million. Looking at the results, I doubt the breakout was prompted by improved financial performance.
Table: DXN's last 8 quarterly results
Chart: DXN's last 17 quarterly results
Comment & Conclusion
Based on its fair valuation (with PE of 7.8 times) and technical breakout still intact, I would rate DXN a HOLD. Good entry for a trade is at RM1.30.
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