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Wednesday, March 22, 2017

KLSE Screener: A Useful Screener For Identifying Your Next Investment

Most investors don't have time to look at the stock market every day, let alone every hour. They don't have time to compile 8-quarter or 10-year P&L spreadsheets. One of the easiest ways to narrow down the stocks to study is to use screeners or filters. Recently I stumbled upon KLSE Screener, which I find to be very easy to use. I have included it in my Resources.

I will give you 2 examples of how you can screen for stocks. If you are interested in banking stocks, you need to select Main Market & Finance and then key in the parameters. For this example, I have set the following parameters: PE between 8x & 12x; ROE > 8%; DY > 2%; and PTBV < 1x. This is what you will get.



If you want to invest in construction stocks that have been a profit track record of more than 5 years plus 2 parameters - PE between 8x & 15x and DY > 2% - you will get these 3 names.



Finally, the more aggressive players can also try out the warrant screener!! This saves you a lot of hassle to find out the warrant profile from BURSA MALAYSIA. Imagine if you want to punt on Airasia call warrants; you select Airasia & CALL and set your parameters (minimum of 100 days & premium < 20% for example). You will get this. 



KLSE Screener also provides market updates, latest entitlements and quarterly results. Check out KLSE Screener today! 

Beware of "Pump & Dump" Scheme

This morning we received an industry communication letter from BURSA MALAYSIA about the manipulative activities known as "Pump & Dump" scheme. The same warning has also appeared in The Star (here).

This scheme is the updated version of stock tips that you used to get from your friends or colleagues or brother-in-law years ago. You are your only safeguard. If you find the "news" to be too good to be true, then chances are it is not true. However if you feel that the news is a good opportunity, you must do one of two things:
1) If it is a tip about a big project, verify the source of the tip.
2) If it is a case about a big jump in profit, verify the thesis of investment.
In nexttrade, I do not peddle tips; only logical investment thesis or market observations.

Finally, you must exercise caution not to invest all your money in one or two investment ideas. Always diversify your investment so that you can take a hit even after all your careful study or investigation.


Monday, March 20, 2017

Market Outlook as at March 20, 2017

At 4:30pm, volume traded in the overall market was 5.6 billion units. FBMKLCI, FBM70 & FBMSCAP were traded at 1747, 14388 and 16832. As you can see from the charts below, FBMKLCI is testing its resistance from the horizontal line at 1750; FNM70 is testing the line connecting its recent peaks at 14400; and, FBMSCAP is approaching its resistance from the horizontal line at 17100.

When you see two days of  huge volume (5 billion units traded today & last Friday) and the funny stocks starting to rally, you can be sure that the innocent & greedy ones are all loading on stocks in the market. The first meaningful correction is not far away. If you have good profit, this is the time to pocket some. Good luck!!


Chart 1: FBMKLCI's monthly & weekly chart as at Mar 20, 2017_4.00pm (Source: Shareinvestor.com)


Chart 2: FBM70's monthly & weekly chart as at Mar 20, 2017_4.00pm (Source: Shareinvestor.com) 


Chart 3: FBMSCAP's monthly & weekly chart as at Mar 20, 2017_4.00pm (Source: Shareinvestor.com) 

Friday, March 17, 2017

CPO Found Its Footing

CPO appears to have found a bottom - maybe just a temporary bottom - at RM2780 and is now rebounding.


Chart 1: CPO (MYR) daily chart as at Mar 16, 2017 (Source: ifs.marketcenter.com)

CPO (in USD) reflects the same technical picture.



Chart 2: CPO (USD) daily chart as at Mar 16, 2017 (Source: Investing.com)

The recovery in CPO prices could be the catalyst for a play for plantation as better prices coupled with improved FFB output should drive earning higher.

Topglov: Earnings Improved Sequentially


Results Update

For QE28/2/2017, Topglov's net profit rose 13% q-o-q but dropped 21% y-o-y to RM83 million while revenue rose 8% q-o-q or 23% y-o-y to RM852 million. Revenue  rose q-o-q due to upward price revisions. Despite less favorable conditions (arising from higher raw material prices and a competitive environment), profits rose q-o-q due to improvements adopted across the manufacturing process.

 
Table: Topglov's last 8 quarterly results


Graph: Topglov's last 43 quarterly results

Valuation

Topglov (closed at RM5.20 yesterday) is now trading at a trailing PE of 22.9X (based on last 4 quarters' EPS of 22.71 sen). At this PER, Topglov is deemed fully valued.

Technical Outlook

Topglov is resting on its intermediate uptrend line, SS at RM5.20. Its immediate resistance comes from the horizontal line at RM5.35.
 
 
Chart 1: Topglov's weekly chart as at as at Mar 16, 2017 (Source: ShareInvestor.com)

The longer term chart shows a stock with a strong uptrend until 2008. Thereafter its uptrend moderated until recently. Despite an upside breakout in late 2015, the rally was short-lived. It was driven by a jump in earning that didn't sustain and excitement over the dual listing on SGX. Can Topglov "make used" of this breakout? We will have to wait & see.
 

Chart 2: Topglov's monthly chart as at as at Mar 16, 2017 (Source: ShareInvestor.com)

Conclusion

Despite satisfactory financial performance, Topglov's full valuation & unexciting technical outlook rendered the stock as a HOLD

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.

Magni: Earning Growth Slowed


Results Update

For QE31/1/2017, Magni's net profit rose 3.6% q-o-q or 13.4% y-o-y to RM29.6 million while revenue rose 3.3% q-o-q or 7.5% y-o-y to RM289 million. Revenue increased q-o-q due to 3.7%-increase in Garment revenue as a result of favorable foreign exchange rate but was partially weighed down by lower sale orders received and 0.4%-increase in Packaging revenue as a result of higher sale orders received. PBT increased q-o-q due to higher PBT for Garment PBT of 14.2% mainly due to higher revenue and higher foreign exchange gain (Other operating income) which was partially offset by a 158.5%-drop in packaging PBT mainly due to the provision of SIPP's closure costs of RM2.877 million. Had there been no provision for the closure costs, packaging PBT would have been higher by 18.6% versus the preceding quarter mainly due to better productivity, aided by a slight increase in revenue.

Table: Magni's last 8 quarterly results


Graph: Magni's last 32 quarterly results

Valuation

Magni (trading at RM5.16 yesterday) has a trailing PE of 8.4 times (based on last 4 quarters' EPS of 61.73 sen). Its last 2 years' earning CAGR was at 50%; giving the stock a PEG ratio of less than 0.2x. At this PEG ratio, Magni's valuation is still very attractive. 

Technical Outlook

Magni is in a long-term uptrend. The stock broke above the January 2016 high of RM4.60; signaling the continuation of the long-term uptrend.


Chart 1: Magni's monthly chart as at Mar 16, 2017 (Source: ShareInvestor.com)


Chart 2: Magni's weekly chart as at Mar 16, 2017 (Source: ShareInvestor.com)

Conclusion

Based on good financial performance, attractive valuation and bullish technical outlook, Magni remains a very good stock for long-term investment. 

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.

Thursday, March 16, 2017

Gamuda: Next Upleg Could Be Starting Now

Gamuda broke above its recent high of RM5.06-5.07 to touch an intra-day high of RM5.17. This reaffirm the earlier hesitant breakout of the psychological RM5.00 mark and could well signal the continuation of Gamuda's prior uptrend.

Based on a 1-to-1 extension of the August 2016 retracement of RM1.50 (computed by deducting the low of RM3.50 from the preceding high of RM5.00), the target for this upleg would be RM6.50 (by adding RM1.50 to the breakout level of RM5.00).


Chart 1: Gamuda's daily chart as at Mar 16, 2017 (Source: MalaysiaStock.Biz)


Chart 2: Gamuda's weekly chart as at Mar 16, 2017 (Source: MalaysiaStock.Biz)

The breakout in Gamuda share price is also reflected in the breakout of the intermediate downtredn line for Gamuda-WE at RM1.29-1.30.


Chart 3: Gamuda-WE's daily chart as at Mar 16, 2017 (Source: MalaysiaStock.Biz)

Conclusion

Based on the above technical breakout, both Gamuda & Gamuda-WE could be good trading BUYs.

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.

BJFood: Earnings Still Weak

Results Update

For QE31/1/2017, BJFood's net profit dropped by 7% q-o-q or 37% y-o-y to RM4.7 million while revenue rose 10% q-o-q or 11% y-o-y to RM164 million. Revenue & PBT rose q-o-q mainly due to higher contribution from Starbucks operations in Malaysia. PAT however dropped due to disproportionate tax charge for the current quarter as a result of certain expenses or losses being disallowed for tax purposes, different foreign tax rate as well as non-availability of Group tax relief in respect of losses incurred by certain subsidiary companies.


Table: BJFood's last 8 quarterly results
 

Graph: BJFood's last 29 quarterly results 
 
Valuation

BJFood (closed at RM1.86 yesterday) is now trading at a PE of 38 times (based on last 4 quarters' EPS of 4.96 sen. At this PER, BJFood is deemed overvalued.

Technical Outlook

As posted earlier, BJFood broke above its intermediate downtrend line at RM1.80. This breakout may be the prelude to the next upleg for the stock.


Chart 1: BJFood's monthly chart as at Mar 15, 2017 (Source: ShareInvestor.com)


Chart 2: BJFood's daily chart as at Mar 15, 2017 (Source: ShareInvestor.com)
 
Conclusion

Based on weak financial performance & demanding valuation, I would maintain BJFood as a HOLD due to the bullish breakout of the downtrend line.

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.

SCGM: Earning Growth Stagnated

Results Update

In QE31/1/2017, SCGM's net profit was mixed- rose 29% q-o-q but dropped 1% y-o-y to RM7.0 million while revenue rose 9% q-o-q or 23% y-o-y to RM46 million. Revenue increased q-o-q and y-o-y due to increased sales demand from both local and export customers. PBT rose q-o-q due to increase in gain on foreign exchange and interest income but it dropped y-o-y due to higher cost of production attributed by increase in resin price, higher depreciation of property, plant and equipment, higher consumption of electricity power and packing materials.

 
Table: SCGM's last 8 quarterly results

 
Graph: SCGM's last 32 quarterly results

Valuation

SCGM (closed at RM3.82 yesterday) is now trading at a PE of 23X (based on last 4 quarters' EPS of 16.20 sen). With earning growth stagnating, the high PER is not easy to justify. Going forward, SCGM anticipates more states will follow in the footsteps of Selangor to ban the use of polystyrene lunch boxes and this should lead to a huge demand for the products of the company.

Technical Outlook

SCGM is in a long-term uptrend, supported by its 10-month SMA line at RM3.40 (see Chart 1). Last 2 weeks, SCGM broke above June 2016 high of RM3.65. This may signal the continuation of the prior uptrend.


Chart 1: SCGM's monthly chart as at Mar 15, 2017 (Source: ShareInvestor.com)


Chart 2: SCGM's daily chart as at Mar 15, 2017 (Source: ShareInvestor.com)

Conclusion

Despite the demanding valuation, I revised my previous rating from HOLD to a Trading BUY based on satisfactory financial performance, promising prospect and bullish technical outlook.

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.

Tuesday, March 14, 2017

WTIC: Possible Temporary Bottom Formed

Crude oil prices have been dropping in the last few days. It closed at USD48.40 yesterday, just a dollar shy off  its intermediate uptrend line, SS. With the sighting of a hammer, there is a good chance the bottom -at least a temporary one - is near.

  
Chart 1: WTIC's daily chart as at Mar 13, 2017 (Source: Stockcharts.com)

 Many of our O&G stocks dropped quite drastically in the past few days- mirroring the fall in crude oil prices. My favorite, SKPetro even broke uptrend line. It tested the support from the horizontal line at RM1.75.


Chart 2: SKPetro's daily chart as at Mar 13, 2017 (Source: MalaysiaStock.biz)
 
Hibiscus, the smallish O&G stock, dropped back to its uptrend line, SS at RM0.40. 


Chart 3: Hibiscus's daily chart as at Mar 13, 2017 (Source: MalaysiaStock.biz)

If WTIC can stage a recovery next few days, our beaten down O&G stocks could be attractive buys today.

For those who are curious about the outlook of CPO, my chart (CPO prices in USD) tells me that we are likely to see further weakness next few weeks and a test of the support at USD500 before recovery set in.


Chart 4: CPO's weekly chart as at Mar 13, 2017 (Source: Investing.com)

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.

Monday, March 13, 2017

BJFood: Crossed Its Intermediate Downtrend Line

Technical Outlook
 

BJFood has broken above its intermediate downtrend line, RR at RM1.80. If the stock can stay above the breakout level, the next upleg may soon begin. Note that MACD is now above the zero line and +DMI is above -DMI (indicating possible uptrend).


Chart 1:BJFood's weekly chart as at Mar 10, 2017 (Source: MalaysiaStock.biz)


Chart 2: BJFood's monthly chart as at Mar 10, 2017 (Source: MalaysiaStock.biz) 

Recent Results

The latest available result for BJFood is for QE31/10/2016, where its net profit rose 1% q-o-q but dropped by 19% y-o-y to RM5 million while revenue rose 5% q-o-q or 10% y-o-y to RM149 million.

Revenue and pre-tax profit increased slightly mainly due to higher contribution from Starbucks operations in Malaysia. Despite facing headwinds from a weak MYR & poor consumer sentiment, BJFood "expects Starbucks to maintain its revenue growth momentum, especially with its new fast moving consumer goods business, and this will contribute positively to the operating results of the Group going forward." 



Table: BJFood's last 8 quarterly results


Graph: BJFood's last 28 quarterly results (Note: The sharp spike in earnings was due to the extraordinary gain of RM158.6 million recorded in QE31/10/2014) 

Valuation

BJFood (closed at RM1.96 last Friday) is now trading at a PE of 35 times (based on last 4 quarters' EPS of 5.68 sen. At this PER,  BJFood is deemed overvalued.

Conclusion

Based on improving financial performance & mildly positive technical outlook, BJFood' rating is now revised from a SELL to a HOLD.

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.

NTPM: Earnings Dipped Marginally

Result Update

For QE31/1/2016, NTPM's net profit increased by 4% q-o-q or 33% y-o-y to RM17.7 million while revenue was increased by 6% q-o-q or 13% y-o-y to RM161 million. Revenue increased 3.7% q-o-q by RM6.2 million while profit before taxation increased by 5.1% q-o-q or RM1.1 million. The increase in profit before taxation was mainly attributable to higher sales revenue.

 
Table: NTPM's last 8 quarterly results


Graph: NTPM's last 46 quarterly results

Valuation

NTPM (closed at RM0.85 last Friday) is now trading  at a PE of 18.9 times (based on last 4 quarters' EPS of 4.5 sen). At this PER, NTPM is deemed fairly valued.

Technical Outlook

NTPM is in a medium-term upward channel, with support at RM0.85. It is also in a long-term uptrend line since 2006.


Chart 1: NTPM's daily chart as at Mar 10, 2017 (Source: MalaysiaStock.Biz)


Chart 2: NTPM's monthly chart as at Mar 10, 2017 (Source: MalaysiaStock.Biz)

Conclusion

Based on satisfactory financial performance & positive technical outlook, NTPM is a good long-term investment.

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.

Thursday, March 09, 2017

Market Outlook as at March 9, 2017

FBMKLCI dropped 8 points to close at 1717 today. From the weekly chart, we can see that the index - though it has broken above the downtrend line at 1660 - is still boxed in between 1600 & 1720. This leads to a sideways trading where the more applicable indicator is the stochastic indicator. As the indicator shows the index to be in an oversold position, a pullback is expected. 



Chart 1: FBMKLCI's weekly chart as at Mar 9, 2017 (Source: MalaysiaStock.Biz) 

Nevertheless, I like to emphasize again that the long-term outlook for the index has turned mildly bullish. The chart below shows FBMKLCI to have moving within an upward channel, with MACD crossing above its signal line.


Chart 2: FBMKLCI's monthly chart as at Mar 9, 2017 (Source: MalaysiaStock.Biz) 

The market may be taking a cue from Wall Street as traders there are positioning themselves for a correction in the US markets. To me, a mild correction in the US markets is just what the doctor orders for Asian markets going forward.


Chart 3: DJIA's daily chart as at Mar 8, 2017 (Source: Stockchart.com) 

Based on the above, I believe you should stay invested in our market for the near to medium-term.

KSL: Rising In A Hurry

Result Update

KSL's result for QE31/12/2016 was released on February 27. Net profit  rose 200% q-o-q or 162% y-o-y to RM167 million. Revenue rose 41% q-o-q or 142% y-o-y to RM231 million. Profits rose q-o-q due to (1) the change in sales mixed and percentage of completion of the existing main on-going projects of the Group, especially in Johor Bahru and Klang and (2) the gain of approximately RM112.7 million from the fair value adjustment of investment properties. If the latter extraordinary one-off gain were excluded, KSL's net profit would be lowered to RM54 million (or a slight drop from RM56 million reported in QE30/9/2016.


Table: KSL's last 8 quarterly results


Graph: KSL's last 49 quarterly results

Valuation

KSL (at RM1.28 yesterday) is now trading at a trailing PER of 4.1 times (based on last 4 quarters' EPS of 31 sen). If we excluded the huge gain from fair value adjustment in QE30/9/2016, the last 4 quarters' EPS would drop to 20 sen and the trailing PER would rise to 6.4 times. At either PERs, KSL is deemed fairly valued.

Technical Outlook

KSL has broken above its long-term downtrend line, RR at RM1.05 in early February. Its immediate support & resistance will come from the horizontal lines at RM1.20 & RM1.35 respectively.
 

Chart: KSL's monthly chart as at Mar 8, 2017 (Source: Shareinvestor.com)

Conclusion

Based on satisfactory financial performance, fair valuation & bullish technical outlook, KSL's rating is revised from a HOLD to a BUY ON WEAKNESS.

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.

MUDA: Next Upleg Is Knocking


Results Update

Muda's result for QE31/12/2016 was released on Feb 23. Its net profit rose 82% y-o-y to RM18 million while its turnover rose 4% y-o-y to RM361 million. In the immediate preceding quarter, QE30/9/2016, Muda incurred a net loss of RM16 million due mainly to the write-off of inventory, warehouse & other assets of RM21.38 million resulting from a fire incident. If this write-off had not occurred, Muda would have report a net profit of about RM5.6 million.

For QE31/12/2016, Muda's revenue rose 28% q-o-q due mainly from higher revenue from the Trading Division - contributed about 80% of the increase- as a result of peak season for school bookshop operations in Singapore. The remaining increase in revenue came from the Paper Packaging Products division due to higher demand as a result of the festive season. As a result of the increased revenue, Muda's profits rose sharply.


Table: Muda's last 8 quarterly results


Chart 1: Muda's last 43 quarterly results
 

Valuation

Muda (closed at RM1.69 yesterday) is trading at a PE of 27 times (based on last 4 quarters' EPS of 6.16 sen). Excluding the losses from the fire in QE30/9/2016, Muda's last 4 quarters' EPS would be about 13.2 sen. That would lower its PER to about 13 times. At this adjusted PER of 13 times, Muda is deemed attractively valued.

Technical Outlook

Muda is pushing against the intermediate downtrend line, RR at RM1.70. If it can break above the RM1.70 level, Muda's next upleg may begin. (Note: AT the time of writing, Muda was trading at RM1.76.)


Chart 1: Muda's daily chart as at Mar 8,, 2017 (Source: MalaysiaStock.biz)

From Chart 2, we can see that Muda is well-supported by its long-term uptrend line, SS at RM1.40.


Chart 2: Muda's weekly chart as at Mar 8, 2017 (Source: MalaysiaStock.biz)

Conclusion

Based on good financial performance, fairly attractive valuation and bullish technical outlook, Muda's rating is now revised from SELL INTO STRENGTH to BUY.

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.