KLCI Stock - DXN / 5074 - 2011 Quarter 4

Company Info

Market Capital (Capital Size)	298,547,360 (Small)
Par Value	RM 0.25

My Analysis

Forecast P/E now	(1.24-0.085)/0.1766 = 6.54 (Moderate)
Target Price	1.41+0.085 = 1.50 (PE 8.0, EPS 0.1766, DPS 0.085)
Decision	BUY
Comment	Revenue decreased 0.1% and is second consecutive quarter decreasing but higher than preceding year corresponding quarter 7.3%, eps decreased 43.4% and is second consecutive quarter decreasing but higher than preceding year corresponding quarter 32.7%, cash generated from operating after deduct all expenses still got some left, weaker liquidity ratio at moderate level now, higher gearing ratio at below moderate level now, all turnover periods improved, lower working capital, raw material increasing, Group performance compare to corresponding year quarter still growing
First Support Price	1.2
Second Support Price	1.1
Risk Rating	MODERATE

Accounting Ratio

Return on Equity	18.88%
Dividend Yield	7.86%
Profit Margin	17.36%
Tax Rate	38.77%
Asset Turnover	0.9463
Net Asset Value Per Share	0.95
Net Tangible Asset per share	0.91
Price/Net Tangible Asset Per Share	1.43
Cash Per Share	0.18
Liquidity Current Ratio	2.8807
Liquidity Quick Ratio	1.5199
Liquidity Cash Ratio	0.7081
Gearing Debt to Equity Ratio	0.3578
Gearing Debt to Asset Ratio	0.2608
Working capital per thousand Ringgit sale	39.6%
Days to sell the inventory	130
Days to collect the receivables	54
Days to pay the payables	57

My notes based on 2011 quarter 4 report (number in '000):-
- By excluding the one-off diminution of investment in CLO subordinated bond of RM5.65 million in the corresponding quarter, the PBT margin achieved in the current quarter was lower than corresponding quarter mainly due to higher provision of the MLM member bonuses and increased in raw materials cost

- Estimate next 4Q eps after 2011 Q3 result announced = (0.03+0.0541)*2*1.05 = 0.1766, estimate PE on current price 1.24 = 6.54(DPS 0.085)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.0505*4*1.05 = 0.2121, estimate highest/lowest PE = 6.91/5.63 (DPS 0.085)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.1465*1.05 = 0.1538, estimate highest/lowest PE = 8.99/4.5 (DPS 0.0375)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.1238*0.9 = 0.1114(10% drop), estimate highest/lowest PE = 6.24/4.44 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0397*4*0.8 = 0.127, estimate highest/lowest PE = 5.28/4.49 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0615*2 = 0.123, estimate highest/lowest PE = 5.81/4.11 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0874*1.1 = 0.0961, estimate highest/lowest PE = 6.87/3.64 (DPS 0.03)

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