Highlights

Fat profit stock

Author: diehardunited   |   Latest post: Wed, 15 Jan 2020, 12:00 AM

 

THE ONCE AND FOREVER DARLING STOCK WILL CNY RALLY SOON!

Author: diehardunited   |  Publish date: Wed, 15 Jan 2020, 12:00 AM


 

Trading Stock
 Date/日期 : 15/1/2020
 
MYEG (0138)
 
 Price/现价           : RM1.13
 Target price/目标价: RM1.25/RM1.36
 Cut loss/止损价    : RM1.09
**Syariah
 
**Validation: Bullish Resurgence Formation
• The share price has made a higher low structure with testing of RM1.20 high yesterday, which indicates strong accumulation within a certain price range. This has been supported by strong volume since early Dec 2019 until yesterday.
 
• The stock is likely to rally before the end of this week or next week because the daily MACD histogram has been hovering in positive territory; with a high possibility to expand, which means there will be a potential upside in the share price.
 
• DMI+ has improved and still above ADX. This means the final phase of accumulation has already started with potential stronger buying momentum to come soon that will push the share price higher.
 
• RSI has also improved and made a higher low structure as well and still below the overbought level.
 
**Key Catalysts
• The group’s earnings growth will stem from the group’s effort to replicate its offerings in the region and help to reduce the group’s reliance on the local market. 
 
• The Group has been awarded for the implementation of the Tax Monitoring Programme in 30 more cities in Indonesia from 1 year to 3 years and it is renewable upon expiry. Given this project has exceeded the Group’s initial targets and the roll-out will be faster and require lower capex than  previous expectations, THERE COULD BE POTENTIAL POSITIVE EARNINGS SURPRISE TO ANALYSTS’ FORECAST FOR FY20 AND HIGHER TARGET PRICE. Currently, all CIMB, BIMB and MIDF have BUY call on Myeg with TP of RM1.96, RM1.70 and RM1.49 respectively!
 
While investors and fund managers are still obsessed with overrallied Dsonic, they might be overlooked and underestimate this Myeg’s earnings growth story from the region that may attract them to switch to super cheap Myeg. The case could be the same with Dayang, which Dayang has delivered more than what analysts’ forecasts and investors’ expectations except for KYY that led to a super bull rally in Dayang’s share price. Therefore, we could expect Myeg's share price to make CNY rally more than RM1.20 on the potential positive earnings surprise!
 
• Additionally, the latest progress in the commencement of the first phase of its online services in partnership with Land Bank of the Philippines, which to offer e-govt services to the people of the Philippines in transacting with the government
 
• The Group’s business model remains attractive which garner a healthy profit margin of about 50%.
 
• Treasury shares (shares buyback has been increasing by more than 100% in 4QFY19 from 4QFY18)
 
• Strong net cash and generous dividend payout company!
 
 

 

 
 
 
 
 

 
 
Labels: MYEG

PART 2: My O&G stocks TOP PICKS for 6/1/2020

Author: diehardunited   |  Publish date: Mon, 6 Jan 2020, 3:16 PM


 

Straits Inter Logistics (0080) - Riding on higher OIL PRICES
 
• The always lagging O&G stock. The company is one of the largest offshore premium oil bunker in companies.
 
• The company is direct beneficiary from rising O&G activities in Malaysia. About 90% of its customers are consists of O&G players, - PETRONAS, Repsol, Bumi Armada, Alam Maritim, Icon Offshore, just to name a few.
 
• Like Hibiscus, its earnings growth also tied to the oil prices. The bunker price (MGO and MFO products that the company supply) moves in tandem with oil prices. The higher the oil prices, the higher bunker price, the higher its revenue value and earnings value, which would imply higher EPS and cheaper PE ratio. In fact, the bunker prices has been trending up since the potential signing agreement US-China trade deal. Yet, the stock has not reacted to both the US-China deal and current higher oil prices events! 
 
Investors have yet realised this. We can expect that Straits’s share price will likely to skyrocket sooner than later to reflect the higher bunker prices! You can see the benchmark bunker price chart below or see this link: https://bunkerindex.com/prices/portfreels_xmdo.php?port_id=682

• The company would also benefit from the migration of residual fuel to MGO and MFO due to the implementation of IMO’s global sulphur cap, starting January 2020.
 
• Maybank has a BUY call on Straits Inter Logistics with a TP of 42sen based on FY20 EPS.

• The most interesting part, its warrants is only trading at marginal premium with gearing only 1.8. Normally, the warrants moves double than the mother share price moves whenever gearing below 2.0.

 

 
 
 
 
 
 

My O&G stocks TOP PICKS for 6/1/2020

Author: diehardunited   |  Publish date: Sat, 4 Jan 2020, 12:00 AM


 

As oil prices shot higher after a U.S. airstrike killed a high-ranking Iranian military leader, which traders fearful of retaliatory attacks from Tehran on Middle Eastern energy infrastructure, we can expect these key O&G stocks would be potentially rallied next week: 

1st Liners: Producers, FPSO & Rigs:

1. Hibiscus

2. Reach Energy

3. Sapura Energy

4. Yinson

5. Bumi Armada

6. Velesto

 

2nd Liners: Maintenance & Fabrication:

1. Dayang

2. Petra Energy

3. Deleum

4. Wah Seong

 

3rd liners: OSV & Downstream maintenance

1. Alam Maritim 

2. Perdana 

3. Icon Offshore

4. GFM Services - via a newly proposed acquisition of Highbase Strategic Sdn Bhd (HSSB). The latter’s existing orderbook would be a major boost to GFM. Given HSSB’s orderbook of RM261.4 million for over 5 years and assuming conservative PAT margin of 7%, new additional revenue and PAT to GFM would be RM52.3 million and RM3.7 million per year from FY20. GFM's 9M19 and FY18 earnings stood at RM9.1 million and RM7.6 million respectively.

Additionally, the more O&G activities in town, the more HSSB’s downstream maintenance services are also needed. 

Demand for O&G plant turnaround is expected to be positive as plant turnarounds are scheduled periodically and is part of legislation compliance. With the secured contract of providing plant turnaround services for PIC in Johor, this gives HSSB the credibility to bid for similar type of projects in other areas.

The latter’s services are critical as it helps to prevent from undue interruption of its clients’ production performance and avoid damages to clients’ facilities. 

Technical wise, the stock has signaled a bullish reversal as the stock has been positive divergence with weekly MACD histogram, with high possibility to rally upon closing at and above 33sen. Inflow of money into the stock has been increasing as shown in the daily MFI chart, which means strong accumulation in anticipation of the rally ahead.

Recall that the Group has recently proposed the acquisition of approximately 49% stake in HSSB. Additionally, GFM has also entered into a call option agreement, which grants GFM the right to exercise the call option to acquire up to 2% in HSSB @ 51sen/share, which HSSB shall become a 51%-owned subsidiary of GFM upon conversion.

Lastly, "I always believe that the share price move first and fundamentals come second". In other words, it is better to react now on GFM before the actual results come out!

 

Tq, Fred
 
 
 
 
 

 

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