MPI: Earnings dropped sequentially

Result Update

For QE31/3/2017, MPI's net profit dropped 21% q-o-q but rose 11% y-o-y to RM43 million while revenue dropped 1% q-o-q but rose 12% y-o-y to RM396 million. PBT dropped q-o-q due to lower revenue & unfavorable forex differences. Revenue dropped as revenue in Asia and European segments were flat while revenue in USA segment dropped by 6%.


Table: MPI's last 8 quarterly results


Graph: MPI's last 41 quarterly results 

Valuation

MPI (closed at RM11.84 yesterday) is now trading at a trailing PER of 12.7 times (based on last 4 quarters' EPS of 93 sen). At this PER, MPI is deemed fairly attractive. Its dividend yield is also decent at 2.3%.

Technical Outlook

MPI has a strong rally to RM12.00 in the past 3 months. The volatile price movement in the past few weeks suggests that the share price could have made a temporary top.


Chart: MPI's weekly chart as at April 18, 2017 (Source: ShareInvestor.com)  

Conclusion

Based on good financial performance & reasonable valuation, MPI is a good stock for long-term investment. However the stock could have made a temporary top after a strong rally over the past 3 months. Thus you may consider taking profit for at least half your position in this stock.

Note:

I hereby confirm that I do not have any direct interest in the security or securities mentioned in this post. However, I could have an indirect interest in the security or securities mentioned as some of my clients may have an interest in the acquisition or disposal of the aforementioned security or securities. As investor, you should fully research any security before making an investment decision.