Berjaya Sports Toto Bhd (Trading Buy)

• Backed by its resilient gaming business, BJTOTO will appeal to yield-seeking investors who are searching for defensive names amid the prevailing market volatility.
• From a technical viewpoint, the stock (which closed at RM2.17 yesterday) is currently hovering near its recent lows, thus offering investors a timely opportunity to accumulate the shares with relatively limited downside risk.
• On the back of a probable technical rebound from the current level, the stock could resume its positive momentum to test our resistance target of RM2.30 (R1) (+6% potential upside). A further push may then lift the share price towards the next resistance level of RM2.39 (R2) (+10% potential upside).
• Our stop loss line is set at RM2.11 (which represents a downside risk of 3%).
• In addition to the potential capital gains, BJTOTO offers expected dividend return of 7.4% based on FY Apr 2020 consensus DPS estimate of 16.1 sen.

Magnum Bhd (Trading Buy)

• MAGNUM is a defensive stock with downside support from dividend yields backed by its stable gaming business.
• On the chart, the stock – which has been moving sideways recently to close at RM2.20 yesterday – is currently treading near the bottom end of a trading range.
• Technically speaking, this could set the stage for the share price to bounce up towards our resistance target of RM2.34 (R1) (+6% potential upside). Should the positive momentum persist, the stock may test the next resistance threshold of RM2.43 (R2) (+10% potential upside).
• We have pegged our stop loss level at RM2.10 (5% downside risk).
• Based on FY Dec 2020 consensus DPS of 10.7 sen, the expected dividend yield for MAGNUM translates to 4.9%.

Source: Kenanga Research - 15 Jul 2020