MISC: Earnings jumped

 Results Update

For QE30/6/2015, MISC's net profit increased by 53% q-o-q or 157% y-o-y to RM745 million while revenue rose 4% q-o-q or 2% y-o-y to RM2.6 billion. Revenue increased q-o-q due to improved freight rates in Petroleum business and revenue recognized from an EPC project contributed. Profits also increased q-o-q mainly due to higher revenue and cost savings from operating a smaller fleet of Chemical tankers.


 Table: MISC's last 8 quarterly results


Chart 1: MISC's last 37 quarterly results

Valuation

MISC (RM7.78 yesterday) is now trading at a PE of 13.times (based on last 4 quarterly EPS of 60 sen). At this PE, MISC is deemed attractively valued.

Technical Outlook

MISC has corrected back to its uptrend line at about RM7.80(see Chart 2).  The RM7.80 level is also the strong horizontal support for MISC. (see Chart 3). The overhead resistance posed by the line connecting recent peaks, AB should cap any near term upside for the stock at RM9.00.


Chart 2: MISC's weekly chart as at August 3, 2015 (Source: ShareInvestor.com)

Chart 3: MISC's monthly chart as at August 3, 2015 (Source: ShareInvestor.com)

Conclusion

 

Based on satisfactory financial performance, fairly attractive valuation & mildly positive technical outlook, MISC is a good stock for long-term investment. The rating is now revised back to a HOLD.

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, MISC.