AEONCr has announced its results for 3-month ended 20/11/2011. Its net profit increased by 7.7% Q-O-Q or 57.4% y-o-y to RM25.3 million while its turnover increased by 8% q-o-q or 60% y-o-y to RM90.0 million. The better results was attributed to "growth in receivables & increased financing transaction volume".
Table: AEONCr's last 8 quarters' results
Chart 1: AEONCr's last 18 quarters' results
Valuation
AEONCr (closed at RM6.57 yesterday) is now trading at a PE of 9 times (based on last 4 quarters' EPS of 72.75 sen). Based on a CAGR of 23% over the past 3 years, AEONCr's PEG ratio comes to only 0.39 time. However, we must note that the CAGR was exaggerated somewhat by the jump in the growth rate in the past 4 quarters. If we were to discount this jump in growth, AEONCr's CAGR is still quite decent at 12-15% per annum. The adjusted PEG ratio would still below 1 time. Thus, the current valuation for AEONCr is deemed undemanding.
Technical Outlook
The stock broke above the RM4.00 level in April & hit a high of RM5.00. It consolidated for a while before surging higher in November. Yesterday, it closed at the high of RM6.57. We can see some bearish signals from the indicators- MACD hooking downward & bearish divergence in the RSI.
Chart 2: AEONCr's daily chart as at Dec 20, 2011 (Source: Quickcharts)
Chart 3: AEONCr's weekly chart as at Dec 20, 2011 (Source: Quickcharts)
Conclusion
Based on good financial performance & undemanding valuation, AEONCr is a good stock for long-term investment. However, the bearish signal in some of the technical indicators could be a small red flag for medium-term investors. If so, you can consider taking some profit for this stock and re-enter it after the expected price consolidation.
good call......TQ
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