Yesterday, SKPRES rose 3 sen, or 6.74%, to 47.5 sen. Newspaper media reported that the group is set to record strong earnings growth over the next three years, thanks to the capacity expansion backed by escalating order from its key customer, Dyson. We believe that the headline has truly captured investors’ attention and ignited confidence on the stock, as SKPRES has broken out from the two-and-half-years resistance on high trading volume yesterday. The increase in trading volume coupled with the MACD-Signal line positive crossover has further convinced us that the stock is poised for a re-rating. Thus, we are placing a “Trading Buy” call on the stock. Traders who look to buy into the stock should target to take profit at RM0.60 (3 bids below the “Bullish Flag” chart pattern measurement objective), while setting a strict stop-loss at RM0.40.

Source: Kenanga