KLCI Stock - AMWAY / 6351 - 2010 Quarter 1

Market Cap : 164385645*7.42 = 1,219,741,485.90 (Moderate)
NTA per share : (243061-4782)/164386 = 1.45
P/BV : 7.42/1.45 = 5.1172
Forecast P/E now : (7.42-0.5)/0.4072 = 16.99
ROE : 29.41%
DY : 0.5/7.42*100 = 6.74%
Fixed Asset Turnover(4 year) : (1.833+1.7549+1.7145+1.9057)/4 = 1.802 (High)
Liquidity Ratio : 267746/125495 = 2.1335 (Moderate)
Receivables Collection Period : (14064+8473)/2/(675574/365) = 6 days (Good)
My Target Price : 6.8+0.5 = 7.3 (EPS 0.4072, PE 16.7, DPS 0.5)
My Decision : NOT BUY unless price below 7.35
My Comment : Revenue increased but cost also increased, good cash flow, moderate debt and increased, navps increased
Technical Support Price : 7.27, 7.19
Risk Rating : LOW
OSK Target Price : 8.95 (01 March 2010)

My notes based on 2010 Q1 report (number in '000):
- The Group’s sales revenue recorded an increase of 7.1% for the quarter under review as compared to the corresponding quarter in the preceding year. The growth in sales revenue was mainly due to pre-price increase buying ahead of the distributor price increase effective 1 March 2010
- The Group’s profit before tax decreased by 14.0% for the quarter under review as compared to the corresponding quarter in the preceding year mainly due to higher distribution expenses incurred from consumer access strategies, brand building initiatives, higher purchase price of products, offset against favorable foreign exchange movements and increase in sales revenue
- The Group’s sales revenue increased marginally by 2.1% as compared to the preceding quarter
- The Group’s profit before tax decreased marginally by 0.8% as compared to the preceding quarter
- Estimate next 4Q eps after 2010 Q1 result announced = 0.1018*4 = 0.4072, estimate PE on current price 7.45 = 17.08(DPS 0.5)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0996*4 = 0.3984, estimate highest/lowest PE = 17.62/16.99 (DPS 0.48)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.1246*4 = 0.4984, estimate highest/lowest PE = 13.98/13.46 (DPS 0.48)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.099*4 = 0.396, estimate highest/lowest PE = 17.6/16.92 (DPS 0.5)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.118*4 = 0.472, estimate highest/lowest PE = 14.79/13.73 (DPS 0.52)
- Estimate next 4Q eps after 2008 Q4 result announced = 0.1332*4 = 0.5328, estimate highest/lowest PE = 13.06/11.75 (DPS 0.54)

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