Thursday, October 20, 2011

UOADEV to test its downtrend line at RM1.65

UOA Development Bhd ('UOADEV') has rallied very well off its recent low of RM1.18. This morning, it broke above its horizontal resistance at RM1.60. It would soon test its downtrend line (RR) at RM1.65 this afternoon. Can it break above that downtrend line? That's the big question. The indicators MACD & RSI have turned upward but the ADX is flattening out. An upside breakout would be positive while the failure to do so could set the stage for a correction for the stock which has rallied 39% off its recent low (from RM1.18 to this morning close of RM1.64). For those holding the stock, it may be advisable to take some profit if the stock fails to break above the downtrend line today.


Chart: UOADEV's daily chart as at Oct 20, 2011_12.10pm (Source: Quickcharts)
at

4 comments:

  1. AnonymousThursday, October 20, 2011 2:56:00 PM

    Hi Alex

    Can you comment on Ogawa? share rarely trade but after checking its balance sheet, Ogawa apparently trade at a discount to its cash. Ogawa has nett cash of 48.3m or 40sen/share against its current share of 34sen.

    More importantly, Ogawa also proposed dividend of 3sen nett, giving rise to yield of 9% nett. With that, i think Ogawa seem to be value buy, what do you think?

    ReplyDelete
  2. Alex LuThursday, October 20, 2011 3:49:00 PM

    Hi hng

    You are right. Ogawa (at RM0.34 each) is backed by cash p.s. of 40 sen. With EPS of 5.3 sen, its PE is about 6.4 times. Based on announced dividend of 3 sen, its dividend yield would be whopping 9%.

    However, you must bear in mind the following:
    1) the stock is thinly trade & range-bound between RM0.27 & RM0.43; and
    2) the product is relatively expensive and it can only sell well during good time. Notice the lower sales in FY2008 & FY2009 as well as losses incurred during those two years.

    In conclusion, the stock is cheap for a reason. If you have a long investment time horizon, you may go for it.

    ReplyDelete
  3. DJ MaxThursday, October 20, 2011 10:29:00 PM

    EPF buying.. No downtrend in sight so fast I guess. Repeat BIMB trend soon.. Watch out how UOA gonna hit RM 1.80, then 1.90..
    Just my 2 cents of opinion

    ReplyDelete
  4. KENNY BLOGTuesday, November 01, 2011 1:54:00 AM

    UOA dev has broke 1.64.

    ReplyDelete