Background

Spritzer Bhd ('Spritzr') is involved in the manufacturing and distribution of natural mineral water, sparkling natural mineral water, distilled drinking water, carbonated fruit flavoured water, carbonated fruit flavour isotonic water, teas, toothbrushes, preforms and packaging bottles.

I posted on this stock in September last year, which was entitled 'Spritzr- a not-so fizzy stock'. Well, it is bubbling up now.

Recent Financial Results

For QE28/2/2010, Spritzr's net profit increased by 1.7% q-o-q or 32% y-o-y to RM3.2 million while its turnover increased by 10.0% q-o-q or 17% y-o-y to RM32.5 million.


Table 1: Spritzr's last 8 quarterly results


Chart 1: Spritzr's 15 quarterly results

Valuation

Spritzr (at RM1.15 as at 4.30pm today) is now trading at a PER of 13 times (based on last 4 quarters' EPS of 8.7 sen. Due to its strong growth over the past few quarters, Spritzr could easily trade at a PER of 15 times. At a PER of 15 times, Spritzr would command a fair value of RM1.30.

Technical Outlook

Spritzr broke above its recent high of RM1.05 (after a few attempts). With this breakout, Spritzr could continue with its prior uptrend.


Chart 2: Spritzr's daily chart as at May 14, 2010 (Source: Quickcharts)


Chart 3: Spritzr's monthly chart as at May 3, 2010 (Source: Tradesignum)

Conclusion

Based on good financial performance, reasonable valuation & further technical breakout, Spritzr could be a good trading BUY.