Ya. I suppose all Glove counters will follow Top Glove and Hartalega for a very bullish Glove market today. Top Glove is up by nearly RM$0.70 in Singapore mkt and Harta is adopting a min 60% Div payout. With a EPS of more than $1, ie a min of $0.60 Div a year. What about value of Co, assets and etc. Where u get any of this shares in the world today. Fed confirm almost Zero interest rate till at least 2023
Industry average PE last 5 years = 22 PE Comfort recent quarter results = EPS 7.2 sen Orders locked in for next 18 months (with or without vaccine)
So per annum EPS is minimum 7.2 sen x 4 = 28.8 sen Applying PE22, target price is RM6.30
We do know that ASPs are continuing to rise. Applying conservative further 20% ASP hike (50m per quarter profit versus previous 42m): Target price is RM7.50.
But this requires holding for longer term and not worrying about the daily trading fluctuations and rumours.
Currently all the gloves players are building new production lines to cater to overwhelming demand. It takes 2-3 months to get the production lines going. Therefore, we can expect their quarterly results to keep going up strongly as new lines come online. Please bear in mind that these companies are not going to invest into new production lines if they expect to monetise from it for only a few months.
With or without vaccines, the backlog has to be fulfilled. Therefore no dip in sales volume expected.
Malaysia is lucky to have all the major gloves players. This gives us the opportunity to play. If you invest long term, you should see profits. These are not stocks for speculative play at current price point.
Now the challenge is to decide which company to invest among them. All of these companies have chinaman mentality. Some owners are unscrupulous. You need to bet on the right horse. Good luck everyone. Let's not go down history as Malaysians who failed to make a single sen from gloves boom because there will likely not be a next time.
Longer term will be slowly up for sure. The results are undeniable. And the share price and fair PE's will reflect such. Weighing machine over a voting machine. Remember that :)
yes u are right. Based on forward PE of 22 with 50m qr each quarter. RM7.5 - 8.5 is reachable. However this is stock market, analysis does not always work with sentiments
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Posted by KK > 2020-09-16 20:47 | Report Abuse
https://www.globenewswire.com/news-release/2020/09/16/2094308/0/en/Global-15-73-Bn-Disposable-Gloves-Market-to-2027-The-Upside-and-Downside-of-the-Pandemic.html