Result Update
For QE31/3/2013, net profit rose 28% q-o-q or 90% y-o-y to RM7.6 million while revenue was hardly changed at RM95 million (up 1% q-o-q but dropped 3% y-o-y). The company attributed its increased profit to continuous improvement in operational efficiencies.
Table: Tienwah's last 8 quarterly results
Chart 1: Tienwah's last 25 quarterly results
Valuation
Tienwah (at RM2.50 as at 3.15pm) is trading at a PE of 7.8 times (based on last 4 quarters' EPS of 31.9 sen). At this PE, Tienwah is deemed very attractive when compared to another packaging stock, Daiboci which commands a PE of 14-15 times.
Technical Outlook
Tienwah's gradual uptrend began in 2009 aftre the stock broke above its horizontal line RM1.30. The stock moves in an upward channel. In April, it broke above the upper boundary at RM2.20. With this breakout, Tienwah's uptrend could pick up pace.
Chart 2: Tienwah's monthly chart as at May 10, 2013_12.30pm (Source: quickcharts)
Conclusion
Based on improving financial performance, cheap valuation & positive technical outlook, Tienwah is a good stock for long-term investment.
Note:
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, Tienwah.
Hi Alex,
ReplyDeleteWhat do you think about advanced Packaging ?
Thanks
Hi networking
ReplyDeleteAdvanced Packaging has a EPS of 13 sen. At RM1.69, it is trading at a PE of 13 times. Its PB is about 1 time. All in all, it is fully-valued, except for its HIGH dividend of 8.3% (or 14 sen last year). Its cash in hand is also pretty high at RM12 million as at 31/3/2013 (or, 60 sen per share).
However, there is no growth in this company and it is a small-cap with only 20 million shares issued. The share price is rising in this environment where everyone is chasing yield.