TEO SENG (7252)

Teo Seng Capital Bhd engages in poultry farming business. The company operates through Investment Holding; Trading of Pet Food, Medicine, and Other Related Products; and Poultry Farming segments. It produces eggs. The firm also manufactures and markets paper egg trays and animal feeds, as well as distribute food, medicine, and other health products. In addition, it trades in and generates energy through the establishment of biogas plants; and is involved in the wholesale, import, and export of eggs products. Further, the firm provides waste management and cool room services. It also produces, processes, preserves, and wholesales meat and meat related products; and engages in the fertilizer and agriculture businesses. The firm earns most of its revenue from Poultry Farming segment.

Fundamental Analysis

Figure 1: Quarter revenue of TEO SENG

Figure 2: Quarter profit of TEO SENG

Figure 3: Quarter Earnings per Share (EPS) of TEO SENG

Figure 4: Quarter net asset per share (NAPS) of TEO SENG

Figure 5: Annual Price Earning (PE) ratio of TEO SENG

The figure above shows that there is a remarkable improvement in TEO SENG’s financial for the last 3 quarters, as TEO SENG has turned loss to profit with tremendous growth for 3 quarters consecutively in 3Q18. The trend of TEO SENG’s quarter EPS is similar with its quarter profit’s indicating that the dilution of its share value is negligible over the years. Besides, the NAPS of TEO SENG is increasing constantly over the years showing that the value of its share is appreciating in the long term. TEO SENG is also undervalued currently, as its PE ratio is only 9.53 (PE<15).

MQ Fundamental Analysis

Based on MQ Fundamental Analysis, TEO SENG is not considered as a stock with good fundamentals, as it scores 1.8/5.0 for MQ Fundamental Rating. According to MQ Trader criteria, a stock with good fundamentals should achieve at least 2.5/5.0 for MQ Fundamental Rating. One of the main reasons that deteriorate its MQ Fundamental Rating is its failure to convert the sales to profit consecutively for 4 out of 5 years. Hence, the subsequent annual reports are very crucial to determine the sustainability of TEO SENG’s growing profitability in the long run.

1 Year Technical Chart

Guppy MMA is used to identify the trend of TEO SENG’s share price in a year as shown in the figure above. TEO SENG’s share price is observed to ride on a positive momentum in the long term especially when its share price is on uptrend for approximately half a year. Furthermore, there is a sharp increase in its share price took place indicating that the buying pressure is growing exponentially recently.

Technical Analysis

MQ Technical Rating

TEO SENG’s MQ Technical Rating is 3.2/5.0 which indicates the recovery of buy momentum on its share currently.

Majority of MQ Trader trading strategies captured buy signals with strong buy momentum in the end of June 2019. This reflects the positive impact brought by its strong profit margin with exponential growth for the last 3 quarters.

To confirm the signal quality, MQ Backtesting is used to determine the success rate of the signal. Based on the MQ Backtesting result, the highest backtesting rating achieved is 3.1/5.0 which is a positive rating. In short, traders can start to grab the opportunity, as there are chances for the share price to rise within 10 trading days.

Conclusion

In our opinion, we will start to look for the right spot to enter our position to grab the opportunity of TEO SENG’s positive momentum in the short term. At the same time, we will monitor our position closely until there is any news that can affect its share price announced. For long term wise, we will wait for next annual financial results to determine the ability of TEO SENG to maintain its profitability for a long period.

MQ Trader Analysis Tool

To view VIZIONE’s fundamental analysis on MQ Trader: https://klse.i3investor.com/mqtrader/sf/analysis/fa/7252

To view VIZIONE's technical analysis on MQ Trader: https://klse.i3investor.com/mqtrader/sf/analysis/stkta/7252

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Disclaimer

This article does not represent a BUY or SELL recommendation on the stock covered. Traders and Investors are encouraged to do their own analysis on stocks instead of blindly following any Trading calls raised by various parties in the Internet. We may or may not hold position in the stock covered, or initiate new position in the stock within the next 7 days.

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