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Friday, January 27, 2012

KLCI Stock - ANNJOO / 6556 - 2011 Quarter 3

Company Info
Market Capital (Capital Size)972,237,211 (Medium)
Par ValueRM 1.00

My Analysis
Forecast P/E now(1.86-0.07)/0.121 = 14.79 (High)
Target Price1.69+0.07 = 1.76 (PE 14.0, EPS 0.121, DPS 0.07)
DecisionNot interested unless stock buying volume stronger than selling and got strong support at 1.8 above
Comment
Revenue increased 12.7% and also higher than preceding year corresponding quarter 87.2%, eps decreased 157.2 and was second consecutive quarter decreasing and also lower than preceding year corresponding quarter 248.4%, cash generated from operating more than enough to cover all expenses, weaker liquidity ratio at low level now, lower gearing ratio but still at high level now, lower inventory can indicate sales slow down
First Support Price1.8
Second Support Price1.6
Risk RatingMODERATE

Research House
RHB Target Price3.02 (2011-02-22)
OSK Target Price2.89 (2011-02-25)
CIMB Target Price3.74 (2011-05-27)
MIDF Target Price2.8 (2011-05-27)
Affin Target Price2.7 (2011-09-20)
HLG Target Price1.34 (2011-11-25)
Maybank Target Price1.3 (2011-11-25)

Accounting Ratio
Return on Equity5.84%
Dividend Yield5.56%
Profit Margin-4.71%
Tax Rate-
Asset Turnover0.8024
Net Asset Value Per Share1.4
Net Tangible Asset per share1.38
Price/Net Tangible Asset Per Share1.43
Cash Per Share0.13
Liquidity Current Ratio1.4253
Liquidity Quick Ratio0.404
Liquidity Cash Ratio0.0947
Gearing Debt to Equity Ratio1.5305
Gearing Debt to Asset Ratio0.604
Working capital per thousand Ringgit sale21.0%
Days to sell the inventory190
Days to collect the receivables56
Days to pay the payables31

Technical Analysis
SMA 201.83 (Uptrend 9 days)
SMA 501.844 (Downtrend)
SMA 1001.973 (Downtrend)
SMA 2002.345 (Downtrend)
MACD-0.038709 (Uptrend 22 days)
MACD Histogram0.026341 (Uptrend 15 days)

My notes based on 2011 quarter 3 report (number in '000):-
- Higher revenue mainly due to higher sales tonnage arisen from the recovery in international market and domestic demand

- Loss mainly attributable to an allowance for diminution in value of inventories of RM37.88 million to reflect the prevailing price level in view of the sharp contraction in international steel prices coupled with an unexpectedly weakened RM against USD that has resulted in recognition of an unrealized foreign exchange loss of RM22.52 million

- Estimate next 4Q eps after 2011 Q3 result announced = (37880+22520-29476)*0.83/763444*4*0.9 = 0.121, estimate PE on current price 1.86 = 14.79(DPS 0.07)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.0477*4*0.8 = 0.1526, estimate highest/lowest PE = 16.56/11.25 (DPS 0.1234)
- Estimate next 4Q eps after 2011 Q1 result announced = (0.04+0.0602)*2 = 0.2004, estimate highest/lowest PE = 14.3/10.96 (DPS 0.1234)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.04*4 = 0.16, estimate highest/lowest PE = 19.31/16.69 (DPS 0.06)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0517*4 = 0.2068(0.0517 is average eps of Q110,Q409,Q308, due to steel price decreasing), estimate highest/lowest PE = 15.91/11.9 (DPS 0.06)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0591*4 = 0.2364, estimate highest/lowest PE = 12.39/9.31 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.048*4 = 0.192, estimate highest/lowest PE = 15.68/13.54 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0682*4 = 0.2728, estimate highest/lowest PE = 12.17/8.69 (DPS 0.03)

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