As a short review, the group YOY revenue increased 1.3% whereas net profit declined -28.2% drastically. The stock price has followed the trend declined -29.3% in one year. The reasons for the depressed net profit are high resin cost and unable to pass through completely to the buyers in order to maintain competitive advantage.
Anyway, I think the market reaction is over pessimistic and I personally believe the stock is being oversold. As mentioned many times in my blog, when the company is still profitable, no point to sell their stock. Rather I consider this is an opportunity to accumulate.
To make a decision whether I should continue accumulate the stock, I study their financial result result again. See exhibit 1 below.
The reasons I think the stock is being oversold are as following.
I still hold this stock in my portfolio and I will continue to accumulate this stock to lower down the cost. No valuation from me this time. However, Kenanga Research issued their fair value at MYR 1.00 on Jan.16, 2018, whereas I personally consider this fair value was not accurate. I am not to offence or to challenge anyone. In this world of investment, different voices make it more interesting.
https://streetanalystblog.wordpress.com/2018/03/05/bpplas-a-stock-being-oversold/
Chart | Stock Name | Last | Change | Volume |
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Created by Tan KW | Aug 25, 2024
Created by Tan KW | Aug 25, 2024
Lyo82
Hopefully you are right, cheers.
2018-03-13 15:57